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HW3 Midterm
HW3 Midterm
Problem 1 (16 points): When a machine is properly calibrated, 0.5% of its output is
defective, but when it is out of adjustment, 6% of the output is defective. The
technician in charge of calibration can successfully calibrate the machine in 90% of
his attempts. The technician has just made an attempt to calibrate the machine.
a) (8 points) The first unit produced after the calibration effort is found to be
defective. Given this information, what is the probability that the machine is in
adjustment?
b) (8 points) The first unit produced after the calibration effort is found to be
normal (not defective). Given this information, what is the probability that the
machine is out of adjustment?
Problem 3 (10 points): In its Sunday business supplement a local newspaper reported
that 33% of those employed full time work less than 40 hours per week, and 20.05%
of those employed work more than 49 hours per week. Assuming that the hours
worked per week by a randomly chosen full time worker in a randomly chosen week
is normally distributed find the population mean and standard deviation of that
distribution.
Problem 4 (15 points): Annual sales revenue for Meadow Flower Cereal is
$500,000.000. Jeffery Shower, a 52 year old senior vice president, is in charge of
production and sales of Nutty 8 cereal. Daily production in cases is normally
distributed with a mean of 100 and a variance of 625. Daily sales in cases are also
normally distributed with a mean of 100 and standard deviation of 8. Sales and
production have a correlation of 0.60. The selling price per case is $10. The variable
production cost per case is $7. The fixed production costs per day are $250. What is
the probability that total revenue is greater than total costs on any day?
Problem 6 (12 points): There are two locations in town (north and south) under
consideration for a new restaurant, but only one location will actually become
available. If it is in the north, the restaurant stands a 90% chance of surviving its first
year. However, if it is built in the south, its chances of survival are only 65%. It is
estimated that the chances of the northern location being available are 40%.
a) (6 points) Find the probability that the restaurant will survive its first year.
b) (6 points) Find the probability that the restaurant is in the south given that it is
successful.
Problem 7 (11 points): Boxes are filled with sugar by a machine that is set to deliver
an average of 20.3 ounces. The weights are normally distributed with a standard
deviation of 0.3 ounces.
a) (5 points) If a consumer advocate buys a package of the product and then
proceeds to weigh the contents, what is the probability that the package she
has purchased will have a content weight between 20 and 21 ounces?
b) (6 points) If a consumer advocate buys a package of the product and then
proceeds to weigh the contents, what is the probability that the package she
has purchased will have a content weight either above 21.2 or below 19.6
ounces?