A First Course in Probability
9th Edition
ISBN: 9780321794772
Author: Sheldon Ross
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 4, Problem 4.23P
You have $1000, and a certain commodity presently sells for $2 per ounce. Suppose that after one week the commodity will sell for either $1 or $4 an ounce, with these two possibilities being equally likely.
a If your objective is to maximize the expected amount of money that you possess at the end of the week, what strategy should you employ?
b. If your objective is to maximize the expected amount of the commodity that you possess at the end of the week what strategy should you employ?
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
A manufacturer produces a toy sold during the summer season at a unit production cost of $5. The manufacturer sells the toy to a retailer, who then sells the product for $35 to the end customer. The manufacturer and retailer have agreed upon a revenue sharing contract that coordinates the supply chain and optimizes the expected profit of the entire supply chain (i.e., the retailer and the manufacturer), which is expected to be $4,000 over the summer selling season. If the wholesale price of the revenue sharing contract is $2, what is the manufacturer’s expected profit? PLEASE SHOW CALCULATIONS
The Harriet Hotel in downtown Boston has 100 rooms that rent for $150 per night. It costs the hotel $30 per room in variable costs (cleaning, bathroom items, etc.) each night a room is occupied. For each reservation accepted, there is a 5% chance that the guest will not arrive. If the hotel overbooks, it costs $200 to compensate guests whose reservations cannot be honored. How many reservations should the hotel accept if it wants to maximize the average daily profit?
If a household has 3 members, and has an annual income of $100,000, predict this household’s monthly spending.
Chapter 4 Solutions
A First Course in Probability
Ch. 4 - Two balls are chosen randomly from an urn...Ch. 4 - Two fair dice are rolled, Let X equal the product...Ch. 4 - Three dice are rolled. By assuming that each of...Ch. 4 - Five men and 5 women are ranked according to their...Ch. 4 - Let X represent the difference between the number...Ch. 4 - In Problem 4.5 for n=3, if the coin is assumed...Ch. 4 - Suppose that a die is rolled twice. What are the...Ch. 4 - If the die in Problem 4.7 is assumed fair,...Ch. 4 - Repeat Example 1c, when the balls are selected...Ch. 4 - Let X be the winnings of a gambler. Let...
Ch. 4 - The random variable X is said to follow the...Ch. 4 - In the game of Two-Finger Morra, 2 players show 1...Ch. 4 - A salesman has scheduled two appointments to sell...Ch. 4 - Five distinct numbers are randomly distributed to...Ch. 4 - The National Basketball Association (NBA) draft...Ch. 4 - A deck of n cards numbered 1 through n are to be...Ch. 4 - Suppose that the distribution function of X is...Ch. 4 - Four independent flips of a fair coin are made....Ch. 4 - If the distribution function of X is given...Ch. 4 - A gambling book recommends the following winning...Ch. 4 - Four buses carrying 148 students from the same...Ch. 4 - Suppose that two teams play a series of games that...Ch. 4 - You have $1000, and a certain commodity presently...Ch. 4 - A and B play the following game: A writes down...Ch. 4 - Prob. 4.25PCh. 4 - One of the numbers I through 10 is randomly...Ch. 4 - An insurance company writes a policy to the effect...Ch. 4 - A sample of 3 items is selected at random from a...Ch. 4 - There are two possible causes for a breakdown of a...Ch. 4 - A person tosses a fair coin until a tail appears...Ch. 4 - 4.31. Each night different meteorologists give us...Ch. 4 - To determine whether they have a certain disease,...Ch. 4 - A newsboy purchases papers at 10 cents and sells...Ch. 4 - Prob. 4.34PCh. 4 - A box contains 5 red and 5 blue marbles. Two...Ch. 4 - Consider Problem 4.22 t with i=2. Find the...Ch. 4 - Find Var (X) and Var (Y) for X and as given in...Ch. 4 - If E[X]=1 and var(X)=5, find a. E[(2+X)2]; b....Ch. 4 - A ball is drawn from an urn containing 3 white and...Ch. 4 - On a multiple-choice exam with 3 possible answers...Ch. 4 - A man claims to have extrasensory perception. As a...Ch. 4 - A and B will take the same 10-question...Ch. 4 - A communications channel transmits the digits 0...Ch. 4 - A satellite system consists of n components and...Ch. 4 - A student is getting ready to take an important...Ch. 4 - Suppose that it takes at least 9 votes from a...Ch. 4 - In some military courts, 9 judges are appointed....Ch. 4 - It is known that diskettes produced by a certain...Ch. 4 - When coin 1 is flipped, it lands on heads with...Ch. 4 - Suppose that a biased coin that lands on heads...Ch. 4 - The expected number of typographical errors on a...Ch. 4 - The monthly worldwide average number of airplane...Ch. 4 - Approximately 80000 marriages took place in the...Ch. 4 - State your assumptions. Suppose that the average...Ch. 4 - A certain typing agency employs 2 typists. The...Ch. 4 - How many people are needed so that the probability...Ch. 4 - Suppose that the number of accidents occurring on...Ch. 4 - Compare the Poisson approximation with the correct...Ch. 4 - If you buy a lottery ticket in 50 lotteries, in...Ch. 4 - The number of times that a person contracts a cold...Ch. 4 - The probability of being dealt a full house in a...Ch. 4 - Consider n, independent trials, each of which...Ch. 4 - People enter a gambling casino at a rate of 1...Ch. 4 - The suicide rate in a certain state is 1 suicide...Ch. 4 - Each of 500 soldiers in an army company...Ch. 4 - A total of 2n people, consisting of n married...Ch. 4 - Prob. 4.67PCh. 4 - In response to an attack of 10 missiles, 500...Ch. 4 - A fair coin is flipped 10 times. Find the...Ch. 4 - At time 0, a coin that comes up heads with...Ch. 4 - Consider a roulette wheel consisting of 38 numbers...Ch. 4 - Two athletic teams play a series of games; the...Ch. 4 - Suppose in Problem 4.75 that the two teams are...Ch. 4 - An interviewer is given a list of people she can...Ch. 4 - Prob. 4.75PCh. 4 - Solve the Banach match problem (Example 8e) when...Ch. 4 - In the Banach matchbox problem, find the...Ch. 4 - An urn contains 4 white and 4 black balls. We...Ch. 4 - Suppose that a batch of 100 items contains 6 that...Ch. 4 - A game popular in Nevada gambling casinos is Keno,...Ch. 4 - In Example 81 what percentage of i defective lots...Ch. 4 - A purchaser of transistors buys them in lots of...Ch. 4 - There are three highways in the county. The number...Ch. 4 - Suppose that 10 balls are put into 5 boxes, with...Ch. 4 - There are k types of coupons. Independently of the...Ch. 4 - There are N distinct types of coupons, and each...Ch. 4 - If X has distribution function F, what is the...Ch. 4 - If X has distribution function F, what is the...Ch. 4 - The random variable X is said to have the...Ch. 4 - Let N be a nonnegative integer-valued random...Ch. 4 - Let X be such that P{X=1}=p=1P{X=1}. Find c1 such...Ch. 4 - Let X be a random variable having expected value ...Ch. 4 - Find Var (X) if P(X=a)=(1)=p=1P(X=b)Ch. 4 - Show how the derivation of the binomial...Ch. 4 - Let X be a binomial random variable with...Ch. 4 - Consider n independent sequential trials, each of...Ch. 4 - There are n components lined up in a linear...Ch. 4 - Let X be a binomial random variable with...Ch. 4 - A family has n children with probability pn,n1...Ch. 4 - Suppose that n independent tosses of a coin having...Ch. 4 - Let X be a Poisson random variable with parameter...Ch. 4 - Let X be a Poisson random variable with parameter ...Ch. 4 - Prob. 4.18TECh. 4 - Show that X is a Poisson random variable with...Ch. 4 - Consider n coins, each of which independently...Ch. 4 - From a set of n randomly chosen people, let Eij...Ch. 4 - An urn contains 2 n balls, of which 2 are numbered...Ch. 4 - Consider a random collection of n individuals. In...Ch. 4 - Here is another way to obtain a set of recursive...Ch. 4 - Suppose that the number of events that occur in a...Ch. 4 - Prove i=0nii!=1n!exxndx Hint: Use integration by...Ch. 4 - If X is a geometric random variable, show...Ch. 4 - Let X be a negative binomial random variable with...Ch. 4 - For a hyper geometric random variable,...Ch. 4 - Balls numbered I through N are in an urn. Suppose...Ch. 4 - A jar contains m+n chips, numbered 1, 2,. ., n+m....Ch. 4 - Prob. 4.32TECh. 4 - Prob. 4.33TECh. 4 - Prob. 4.34TECh. 4 - An urn initially contains one red and one blue...Ch. 4 - Prob. 4.36TECh. 4 - Prob. 4.1STPECh. 4 - Prob. 4.2STPECh. 4 - A coin that when flipped comes up heads with...Ch. 4 - Prob. 4.4STPECh. 4 - Suppose that P{X=0}=1P{X=1}. If E[X]=3Var(X), find...Ch. 4 - There are 2 coins in a bin. When one of them is...Ch. 4 - Prob. 4.7STPECh. 4 - Prob. 4.8STPECh. 4 - Prob. 4.9STPECh. 4 - An urn contains n balls numbered 1 through n. If...Ch. 4 - Prob. 4.11STPECh. 4 - Prob. 4.12STPECh. 4 - Each of the members of a 7-judge panel...Ch. 4 - Prob. 4.14STPECh. 4 - The number of eggs laid on a tree leaf by an...Ch. 4 - Each of n boys and n girls, independently and...Ch. 4 - A total of 2n people, consisting of n married...Ch. 4 - Prob. 4.18STPECh. 4 - Prob. 4.19STPECh. 4 - Show that if X is a geometric random variable with...Ch. 4 - Suppose that P{X=a}=p,P{X=b}=1p a. Show that Xbab...Ch. 4 - Prob. 4.22STPECh. 4 - Balls are randomly withdrawn, one at a time...Ch. 4 - Ten balls are to be distributed among 5 urns, with...Ch. 4 - For the match problem (Example 5m in Chapter 2),...Ch. 4 - Let be the probability that a geometric random...Ch. 4 - Two teams will play a series of games, with the...Ch. 4 - An urn has n white and m black balls. Balls are...
Additional Math Textbook Solutions
Find more solutions based on key concepts
Find E(X) for each of the distributions given in Exercise 2.1-3.
Probability and Statistical Inference (9th Edition)
Find E(X) for each of the distributions given in Exercise 2.1-3.
Probability And Statistical Inference (10th Edition)
Testing Hypotheses. In Exercises 13-24, assume that a simple random sample has been selected and test the given...
Elementary Statistics Using The Ti-83/84 Plus Calculator, Books A La Carte Edition (5th Edition)
True or False? Explain.
1. Any set of ordered pairs is a function.
College Algebra (6th Edition)
A booby trap. A small landmass off the Galapagos Islands can sustain a maximum of 50,000 blue-footed boobies. I...
The Heart of Mathematics: An Invitation to Effective Thinking
For each hour of class time, how many hours outside of class are recommended for studying and doing homework?
Elementary Algebra For College Students (10th Edition)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, probability and related others by exploring similar questions and additional content below.Similar questions
- A manufacturer produces two models of television stands. The table at the left shows the times (in hours) required for assembling, staining, and packaging the two models. The total times available for assembling, staining, and packaging are 3750 hours, 8950 hours, and 2650 hours, respectively. The profits per unit are $30 for model I and $40 for model II. What is the optimal inventory level for each model? What is the optimal profit?arrow_forwardAlthough investing all at once works best when stock prices are rising, dollar-cost averaging can be a good way to take advantage of a fluctuating market. Dollar-cost averaging is an investment strategy designed to reduce volatility in which securities are purchased in fixed dollar amounts at regular intervals regardless of what direction the market is moving. This strategy is also called the constant dollar plan. You are considering a hypothetical $1,200 investment in a media company's stock. Your choice is to invest the money all at once or dollar-cost average at the rate of $100 per month for one year. Assume that the company allows you to purchase "fractional" shares of its stock. (a)If you invested all of the money in January and bought the shares for $12 each, how many shares could you buy? shares (b)From the following chart of share prices, calculate the number of shares that would be purchased each month using dollar-cost averaging and the total shares for the year. Round…arrow_forwardAlthough investing all at once works best when stock prices are rising, dollar-cost averaging can be a good way to take advantage of a fluctuating market. Dollar-cost averaging is an investment strategy designed to reduce volatility in which securities are purchased in fixed dollar amounts at regular intervals regardless of what direction the market is moving. This strategy is also called the constant dollar plan. You are considering a hypothetical $1,200 investment in a media company's stock. Your choice is to invest the money all at once or dollar-cost average at the rate of $100 per month for one year. Assume that the company allows you to purchase "fractional" shares of its stock. (a) If you invested all of the money in January and bought the shares for $12 each, how many shares could you buy? shares (b) From the following chart of share prices, calculate the number of shares that would be purchased each month using dollar-cost averaging and the total shares for the year. Round to…arrow_forward
- Although investing all at once works best when stock prices are rising, dollar-cost averaging can be a good way to take advantage of a fluctuating market. Dollar-cost averaging is an investment strategy designed to reduce volatility in which securities are purchased in fixed dollar amounts at regular intervals regardless of what direction the market is moving. This strategy is also called the constant dollar plan. You are considering a hypothetical $1,200 investment in a media company's stock. Your choice is to invest the money all at once or dollar-cost average at the rate of $100 per month for one year. Assume that the company allows you to purchase "fractional" shares of its stock. (a) If you invested all of the money in January and bought the shares for $12 each, how many shares could you buy? shares (b) From the following chart of share prices, calculate the number of shares that would be purchased each month using dollar-cost averaging and the total shares for the year.…arrow_forwardCheryl is considering purchasing additional sewing machines to accommodate the increasing demand for her cosplay costumes. Her alternatives are to buy 1 machine, 2 machines, or 3 machines. The profits realized under each alternative are a function of whether her proposal to bid for clothing the official Bandai team is accepted or not. The payoff table below illustrates the profits realized (in $000's) based on the different scenarios Cheryl faces. The probability that her proposal will be accepted is 65%. Alternative Proposal Accepted Proposal Rejected Purchase 1 sewing machine $10 $5 Purchase 2 sewing machines $30 $4 Purchase 3 sewing machines $40 $2 What alternative should Cherly select if she is pessimistic? What alternative should Cherly select based on a criterion of realism with ?α = 0.8?arrow_forwardAn entrepreneur who owns and operates two businesses (A and B) would like to analyze their profitability. They would like your help in the analysis. They give you the annual net profit (in thousands of $) for each business from 2008-2020. Table 1: Annual Net Profits for Businesses A and B Business Year Profit Business Year Profit 2008 -50 2008 -10 2009 57 2009 30 2010 71 2010 27 2011 64 2011 22 2012 60 2012 21 2013 50 2013 20 A 2014 41 2014 24 2015 59 2015 24 2016 71 2016 32 2017 71 2017 36 2018 74 2018 37 019 81 20 40 2020 97 2020 49 a. Suppose you want to graph the distribution of profits. Explain why using only one stem- plot might not be optimal for the analysis. b. Describe the correct stemplot to use. Generate this stemplot. Explain your steps. What can you say about the distribution from this stemplot? c. When are stemplots useful? And why is that? d. Suppose that instead of having 26 observations you have 200 observations. What graph should you generate? e. What other type of…arrow_forward
- A citrus grower anticipates a profit of $100,000 this year if the nightly temperatures remain mild. Unfortunately, the weather forecast indicates a 25% chance that the temperatures will drop below freezing during the next week. Such freezing weather will destroy 40% of the crop and reduce the profit to $60,000. However, the grower can protect the citrus fruit against the possible freezing (using smudge pots, electric fans, and so on) at a cost of $5000. Should the grower spend the $5000 and thereby reducethe profit to $95,000? [Hint: Compute E(X ), where X is theprofit the grower will get if he does nothing to protect the fruit.]arrow_forwardMorning House is a mail-order firm which carries a wide range of rather expensive art objects for homes and offices. It operate problems would be greatly reduced. Since it takes approximately six weeks to receive 90% of the response to a given campaign, an accurate prediction of total sales made as late as the end of the first week of receiving orders would be useful. The first week’s sales and total sales of the last 12 campaigns of the firm are shown below. Can the first week’s sales be used to predict total sales? First week’s Total Campaign Sales Sales 1 32 167 2 20 91 3 114 560 4 66 335 5 18 70 6 125 650 7 83 401 8 65 320 9 94 470 10 5 15 11 39 210 12 50 265 --------------------------------------------arrow_forwardA retired couple wishes to invest $750,000, diversifying the investment in three areas: a high-risk stock that has an expected annual rate of return (or interest) of 12%, a low-risk stock that has an expected annual return of 8%, and government-issued bonds that pay annual interest of 4% and involve no risk. To protect the value of the investment, the couple wishes to place at least twice as much in the low-risk stock as in the high-risk stock and use the remainder to buy bonds. How should the money be invested to maximize the expected annual return?arrow_forward
- APC industries has been experiencing significant growth and has been having difficulty meeting customer demands recently. They are considering three options to address this issue. They can move to a larger facility, add a second shift or use a subcontractor to assist in production. The annual payoff of each option depends on if the current market continues to expand, hold steady or declines. The expected payoff for each combination is show in the table below Option Expand Steady DeclineMove to larger facility 250,000 125,000 -90,000Add a second shift 175,000 80000 -45,000Subcontract 90,000 15,000 -10,000 a) Which alternative should APC choose under the maximax criterion? b) Which option should APC choose under the maximin criterion? c) Which option…arrow_forwardA couple wants to invest up to $45,000. A Roth IA has a return close to 7% after one year and a CD has a rate of 4% after one year. Since a Roth IRA is riskier, they want to invest no more than $5000 in that account and at least $20,000 in a CD. How much should the couple invest in each account to maximize their return? What would the maximum return be after one year?arrow_forward10. A survey conducted over the last 25 years indicated that in 10 years the winter was mild, in 8 years it was cold and in the remaining 7 years it was very cold. A company sells 1000 woollen coats in a mild year, 1300 in a cold year and 2000 in a very cold year. You are required to find the yearly expected profit of the company if a woollen coat costs it is sold to stores for 1730 and 2480.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Solve ANY Optimization Problem in 5 Steps w/ Examples. What are they and How do you solve them?; Author: Ace Tutors;https://www.youtube.com/watch?v=BfOSKc_sncg;License: Standard YouTube License, CC-BY
Types of solution in LPP|Basic|Multiple solution|Unbounded|Infeasible|GTU|Special case of LP problem; Author: Mechanical Engineering Management;https://www.youtube.com/watch?v=F-D2WICq8Sk;License: Standard YouTube License, CC-BY
Optimization Problems in Calculus; Author: Professor Dave Explains;https://www.youtube.com/watch?v=q1U6AmIa_uQ;License: Standard YouTube License, CC-BY
Introduction to Optimization; Author: Math with Dr. Claire;https://www.youtube.com/watch?v=YLzgYm2tN8E;License: Standard YouTube License, CC-BY