A First Course in Probability (10th Edition)
A First Course in Probability (10th Edition)
10th Edition
ISBN: 9780134753119
Author: Sheldon Ross
Publisher: PEARSON
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Chapter 9, Problem 9.6PTE

Compute the limiting probabilities for the model of Problem 9.4

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An investor is concerned with the market return for the coming year, where the market return is defined as the percentage gain (or loss, if negative) over the year. The investor believes there are five possible scenarios for the national economy in the coming year: rapid expansion, moderate expansion, no growth, moderate contraction, and serious contraction. Furthermore, she has used all of the information available to her to estimate that the market returns for these scenarios are, respectively, 23%, 18%, 15%, 9%, and 3%. That is, the possible returns vary from a high of 23% to a low of 3%. Also, she has assessed that the probabilities of these outcomes are 0.12, 0.40, 0.25, 0.15, and 0.08. Use this information to describe the probability distribution of the market return. Compute the following for the probability distribution of the market return for the coming year.: 1. Mean, 2. Variance, 3. Standard deviation Show your solutions.
2. A leading researcher in the study of interstate highway accidents proposes that a major cause of many collisions on the interstates is not the speed of the vehicles but rather the difference in speeds of the vehicles. When some vehicles are traveling slowly while other vehicles are traveling at speeds greatly in excess of the speed limit, the faster-moving vehicles may have to change lanes quickly, which can increase the chance of an accident. Thus, when there is a large variation in the speeds of the vehicles in a given location on the interstate, there may be a larger number of accidents than when the traffic is moving at a more uniform speed. The researcher believes that when the standard deviation in speed of vehicles exceeds 10 mph, the rate of accidents is greatly increased. During a 1-hour period of time, a random sample of 50 vehicles is selected from a section of an interstate known to have a high rate of accidents, and their speeds are recorded using a radar gun. The data…
A national study found that treating people appropriately for high blood pressure reduced their overall mortality by 20%. Treating people adequately for hypertension has been difficult because it is estimated that 50% of hypertensives do not know they have high blood pressure, 50% of those who do know are inadequately treated by their physicians, and 50% who are appropriately treated fail to follow this treatment by taking the right number of pills. If the preceding 50% rates were each reduced to 35% by a massive education program, then what effect would this change have on the overall mortality rate among true hypertensives; that is, would the mortality rate decrease and, if so, what percentage of deaths among hypertensives could be prevented by the education program? (Round your answer to two decimal places.) The overall mortality rate among hypertensives would be reduced by how much?  If possible please demonstarte how this can be done on a calculator, thank you!
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