PROBABILITY AND STATISTICS FOR ENGINEER
9th Edition
ISBN: 2818000048605
Author: WALPOLE
Publisher: PEARSON
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Chapter 2.5, Problem 65E
(a)
To determine
Find the
(b)
To determine
Find the probability that the component works perfectly well.
(c)
To determine
Find the probability that the component either fails or shows strain in the test.
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Note: The purpose of this problem below is to use computational techniques (Excelspreadsheet, Matlab, R, Python, etc.) and code the dynamic programming ideas seen inclass. Please provide the numerical answer to the questions as well as a sample of yourwork (spreadsheet, code file, etc.).We consider an N-period binomial model with the following properties: N = 60, thecurrent stock price is S0 = 1000; on each period, the stock price increases by 0.5% whenit moves up and decreases by 0.3% when it moves down. The annual interest rate on themoney market is 5%. (Notice that this model is a CRR model, which means that thebinomial tree is recombining.)(a) Find the price at time t0 = 0 of a (European) call option with strike price K = 1040and maturity T = 1 year.(b) Find the price at time t0 = 0 of a (European) put option with strike price K = 1040and maturity T = 1 year.(c) We consider now, that you are at time t5 (i.e. after 5 periods, which represents 1month later). Assume that the stock…
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Chapter 2 Solutions
PROBABILITY AND STATISTICS FOR ENGINEER
Ch. 2.2 - List the elements of each of the following sample...Ch. 2.2 - Use the rule method to describe the sample space S...Ch. 2.2 - Which of the following events are equal?
A = {1,...Ch. 2.2 - An experiment involves tossing a pair of dice, one...Ch. 2.2 - Prob. 5ECh. 2.2 - Two jurors are selected from 4 alternates to serve...Ch. 2.2 - Prob. 7ECh. 2.2 - For the sample space of Exercise 2.4,
list the...Ch. 2.2 - Prob. 9ECh. 2.2 - Prob. 10E
Ch. 2.2 - Prob. 11ECh. 2.2 - Exercise and diet are being studied as possible...Ch. 2.2 - Prob. 13ECh. 2.2 - Prob. 14ECh. 2.2 - Consider the sample space S = {copper, sodium,...Ch. 2.2 - If S = {x | 0 < x < 12}, M = {x | 1 < x < 9}, and...Ch. 2.2 - Prob. 17ECh. 2.2 - Which of the following pairs of events are...Ch. 2.2 - Prob. 19ECh. 2.2 - Referring to Exercise 2.19 and the Venn diagram of...Ch. 2.3 - Registrants at a large convention are offered 6...Ch. 2.3 - In a medical study, patients are classified in 8...Ch. 2.3 - Prob. 23ECh. 2.3 - Students at a private liberal arts college are...Ch. 2.3 - A certain brand of shoes comes in 5 different...Ch. 2.3 - Prob. 26ECh. 2.3 - Prob. 27ECh. 2.3 - A drug for the relief of asthma can be purchased...Ch. 2.3 - Prob. 29ECh. 2.3 - In how many different ways can a true-false...Ch. 2.3 - A witness to a hit-and-run accident told the...Ch. 2.3 - In how many ways can 6 people be lined upto get on...Ch. 2.3 - If a multiple-choice test consists of 5 questions,...Ch. 2.3 - Prob. 34ECh. 2.3 - Prob. 35ECh. 2.3 - Prob. 36ECh. 2.3 - Prob. 37ECh. 2.3 - Prob. 38ECh. 2.3 - In a regional spelling bee, the 8 finalists...Ch. 2.3 - In how many ways can 5 starting positions on a...Ch. 2.3 - Find the number of ways that 6 teachers can be...Ch. 2.3 - Prob. 42ECh. 2.3 - Prob. 43ECh. 2.3 - In how many ways can a caravan of 8 covered wagons...Ch. 2.3 - Prob. 45ECh. 2.3 - In how many ways can 3 oaks, 4 pines, and 2 maples...Ch. 2.3 - How many ways are there to select 3 candidates...Ch. 2.3 - How many ways are there that no two students will...Ch. 2.5 - Find the errors in each of the following...Ch. 2.5 - Prob. 50ECh. 2.5 - A box contains 500 envelopes, of which 75...Ch. 2.5 - Suppose that in a senior college class of 500...Ch. 2.5 - The probability that an American industry will...Ch. 2.5 - From past experience, a stockbroker believes that...Ch. 2.5 - If each coded item in a catalog begins with 3...Ch. 2.5 - An automobile manufacturer is concerned about a...Ch. 2.5 - Prob. 57ECh. 2.5 - A pair of fair dice is tossed. Find the...Ch. 2.5 - In a poker hand consisting of 5 cards, find the...Ch. 2.5 - If 3 books are picked at random from a shelf...Ch. 2.5 - In a high school graduating class of 100 students,...Ch. 2.5 - Prob. 62ECh. 2.5 - Prob. 63ECh. 2.5 - Interest centers around the life of an electronic...Ch. 2.5 - Prob. 65ECh. 2.5 - Factory workers are constantly encouraged to...Ch. 2.5 - Consider the situation of Example 2.32 on page...Ch. 2.5 - Interest centers around the nature of an oven...Ch. 2.5 - Prob. 69ECh. 2.5 - Prob. 70ECh. 2.5 - As the situation of Exercise 2.69 might suggest,...Ch. 2.5 - Prove that
P(A′ ∩ B′) = 1+P(A ∩ B) − P(A) − P(B).
Ch. 2.6 - If R is the event that a convict committed armed...Ch. 2.6 - Prob. 74ECh. 2.6 - A random sample of 200 adults are classified below...Ch. 2.6 - In an experiment to study the relationship of...Ch. 2.6 - In the senior year of a high school graduating...Ch. 2.6 - A manufacturer of a flu vaccine is concerned about...Ch. 2.6 - In USA Today (Sept. 5, 1996), the results of a...Ch. 2.6 - Prob. 80ECh. 2.6 - Prob. 81ECh. 2.6 - For married couples living in a certain suburb,...Ch. 2.6 - The probability that a vehicle entering the Luray...Ch. 2.6 - The probability that the head of a household is...Ch. 2.6 - The probability that a doctor correctly diagnoses...Ch. 2.6 - In 1970, 11% of Americans completed four years of...Ch. 2.6 - A real estate agent has 8 master keys to open...Ch. 2.6 - Before the distribution of certain statistical...Ch. 2.6 - A town has two fire engines operating...Ch. 2.6 - Prob. 90ECh. 2.6 - Find the probability of randomly selecting 4 good...Ch. 2.6 - Prob. 92ECh. 2.6 - A circuit system is given in Figure 2.11. Assume...Ch. 2.6 - Prob. 94ECh. 2.7 - In a certain region of the country it is known...Ch. 2.7 - Police plan to enforce speed limits by using...Ch. 2.7 - Referring to Exercise 2.95, what is the...Ch. 2.7 - If the person in Exercise 2.96 received a speeding...Ch. 2.7 - Suppose that the four inspectors at a film factory...Ch. 2.7 - A regional telephone company operates three...Ch. 2.7 - A paint-store chain produces and sells latex and...Ch. 2.7 - Prob. 102ECh. 2.7 - Prob. 103RECh. 2.7 - An allergist claims that 50% of the patients she...Ch. 2.7 - Prob. 105RECh. 2.7 - Prob. 106RECh. 2.7 - Prob. 107RECh. 2.7 - Prob. 108RECh. 2.7 - A large industrial firm uses three local motels to...Ch. 2.7 - The probability that a patient recovers from a...Ch. 2.7 - Prob. 111RECh. 2.7 - Prob. 112RECh. 2.7 - Prob. 113RECh. 2.7 - Prob. 114RECh. 2.7 - A certain federal agency employs three consulting...Ch. 2.7 - A manufacturer is studying the effects of cooking...Ch. 2.7 - Prob. 117RECh. 2.7 - A certain form of cancer is known to be found in...Ch. 2.7 - A producer of a certain type of electronic...Ch. 2.7 - Prob. 120RECh. 2.7 - Prob. 121RECh. 2.7 - Prob. 122RECh. 2.7 - Prob. 123RECh. 2.7 - Prob. 124RECh. 2.7 - A survey of those using a particular statistical...Ch. 2.7 - During bad economic times, industrial workers are...Ch. 2.7 - There is a 50-50 chance that the queen carries the...
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- answerarrow_forwardQuestion 2 The data below provides the battery life of thirty eight (38) motorcycle batteries. 100 83 83 105 110 81 114 99 101 105 78 115 74 96 106 89 94 81 106 91 93 86 79 103 94 108 113 100 117 120 77 93 93 85 76 89 78 88 680 a. Test the hypothesis that mean battery life is greater than 90. Use the 1% level of significance. b. Determine if the mean battery life is different from 80. Use the 10% level of significance. Show all steps for the hypothesis test c. Would your conlcusion in part (b) change at the 5% level of significance? | d. Confirm test results in part (b) using JASP. Note: All JASP input files and output tables should be providedarrow_forwardSuppose that 80% of athletes at a certain college graduate. You randomly select eight athletes. What’s the chance that at most 7 of them graduate?arrow_forward
- Suppose that you flip a fair coin four times. What’s the chance of getting at least one head?arrow_forwardSuppose that the chance that an elementary student eats hot lunch is 30 percent. What’s the chance that, among 20 randomly selected students, between 6 and 8 students eat hot lunch (inclusive)?arrow_forwardBob’s commuting times to work are varied. He makes it to work on time 80 percent of the time. On 12 randomly selected trips to work, what’s the chance that Bob makes it on time at least 10 times?arrow_forward
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