Concept explainers
(a)
To find: The probability density
(a)
Answer to Problem 33SE
Explanation of Solution
Given information:
Minimum sale price if left on the market
Maximum sale price if left on the market
Offer amount
Calculation:
Let X be the amount received from market for another month.
As the sale price is distributed uniformly, the density function could be written as shown below
The density function is
(b)
To find: The probability of amount greater than or equal to
(b)
Answer to Problem 33SE
The probability of amount greater than or equal to
Explanation of Solution
Calculation:
Computingprobability of amount less than $215000.
On solving further,
So,
The required probability is 0.4
(c)
To find: The probability of amount less than
(c)
Answer to Problem 33SE
The probability of amount less than
Explanation of Solution
Calculation:
Computing probability of amount less than $210000.
On solving further,
The required probability is 0.4.
(d)
To find: The option to leave the house on market should be opted or not.
(d)
Answer to Problem 33SE
The option of leaving on the market should be opted.
Explanation of Solution
Calculation:
The offer price by the executive’s employer is $21000. So, if more amount can be earned from the market, then the option of leaving it on market would seem appropriate.
Using the result from subpart (C),
It can be seen from the above subpart that the probability of getting amount more the offer price of $210000 is 0.6.
So, the probability associated with earning more amount than quoted by employer is 0.6 which is more than half, so the option of leaving on the market seems appropriate as the probability of earning more than the offer price is higher.
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Chapter 6 Solutions
Essentials Of Modern Business Statistics With Microsoft Excel, Loose-leaf Version
- Intermediate AlgebraAlgebraISBN:9781285195728Author:Jerome E. Kaufmann, Karen L. SchwittersPublisher:Cengage Learning
- Algebra for College StudentsAlgebraISBN:9781285195780Author:Jerome E. Kaufmann, Karen L. SchwittersPublisher:Cengage Learning