Name: Liu Xiyue

Student Number: 300128416

Assignment 2 Part2
1. a)
Expected Value=$300*0.2+600*0.6+900*0.2=$600
Variance: (300-600)^2*0.2+0+(900-600)^2*0.2=36000
SD=189.74
b) Standard Deviation represents how spread the numbers are. If SD is high, it means
the probability that the outcome is far lower than the expected outcome. In this way,
larger standard deviation means the greater risk.
c) CoV= SD/E(X)
Investment A = 600/6000=0.1
Investment B = 190/600=0.3167
Investment B has the high coefficient of variation which means it carries higher risk.
The coefficient of variation means proportionally how SD compared to Expected
Value.
We will use Cov than standard deviation since it is useful when the investments have
very big difference. Standard deviation cannot give a fair comparison.
d) Investment 1
Cov=20/600=0.0333
Investment 2
Cov=190/600=0.317
Investment 3
Cov=300/600=0.5

Investment 3 has the highest risk which investment 1 has the lowest risk.
By comparing standard deviations of these investments，we have same results.

2.
P=0.02 q=0.98
a ) p(X=10)=0.98^9*0.02=0.01667
Probability with the 10th medical mask produce is the first one with a defect is
0.01667

b) p(X=0)=0.98^100*0.02^0=0.1326
c) E(X)=1/p=1/0.02=50
SD(X)=square root(0.98)/0.02=49.4975
Therefore an average 50 face mask expect to produced before getting first defective
mask
d) if p=0.05 E(X)=1/0.05=20
SD(X)=square root (0.95)/0.05=19.4936
If defective rate is 5% then on an average 20 face mask expect to produced before
getting first defective mask.
e) Mean and standard deviation of the wait time until the 1st defective
item decrease with the increase of defective rate.

3.
a) E= 15*0.37+15*0.08=6.75
Standard deviation= square root Variance
= square root( 15*0.45*0.55)
=1.9268
B) P（X=more than 3)=1-P(X=1)-P(X=2)-P(X=0)
=1-0.286-0.373-0.227
=0.114
C) E(X)=1/0.37=2.70 donors

D) P(X=4)= 0.37^1*0.63^3=0.09

4.
A) P(X)=(λ^x * e^-λ)/x!

=(e^-2*2x)/x!

B) P(X=0)=0.135,P(X=1)=0.271,P(X=2)=0.271,P(X=3)=0.180,

P(X=4)=0.090,P(X=5)=0.036,P(X=6)=0.012,P(X=7)=0.003

P(X=8)=0.000859

C)
D)P(X=2)=0.271
E) P(less than4)=P(X=0)+P(X=1)+P(X=2)+P(X=3)+P(X=4)=0.947
F) P(1<= x <=4)=P(X=1)+P(X=2)+P(X=3)+P(X=4)=0.812
G)P(2 < x < 5)=P(X=3)+P(X=4)=0.27
H) P(2 <= x <6)=P(X=2)+P(X=3)+P(X=4)+P(X=5)=0.577