Management Science - Chapter 7 - Test Reveiwer

The Ambell Company uses batteries from two different manufacturers.
Historically, 60% of the

batteries are from manufacturer 1, and 90% of these batteries last for over 40 hours. Only 75% of the
batteries from manufacturer 2 last for over 40 hours. A battery in a critical tool fails at 32 hours. Using
Baye's Theorem, What is the probability it was from manufacturer 2? (use 3 decimal places) *
(.4*.25)/(.6*.1+.4*.25) = 0.625 = 62.5%
___________
as a general rule, P(A or B) = P(A) + P(B)
for any battery, it was either from manufacturer 1 (m1) or manufacturer 2 (m2)
so probability that any battery lasts less than 40 hours is:
P(< 40 hours) = P(m1 and < 40 hours) + P(m2 and < 40 hours)
= 60/100 * (1 - 90/100) + 40/100 * (1 - 75/100)
= 16/100
as a general rule, P(A given B) = P(A and B) / P(B)
so probability it was from manufacturer 2 is:
P(m2 given < 40 hours) = P(m2 and < 40 hours) / P(< 40 hours)
= (40/100 * (1 - 75/100)) / (16/100)
= (10/100) / (16/100)
= 5/8
= 62.5%
______________________________________________________________________________
It is estimated that 3% of the athletes competing in a large tournament are users of an illegal drug to
enhance performance. The test for this drug is 90% accurate. Using Baye's, Theorem, what is the
probability that an athlete who tests positive is actually a user? (use 4 decimal places only)
This is an exercise in conditional probability. You can use Bayes' Rule to solve this. However, I find that
it is much easier to just use the definition of conditional probability. In short I derived Bayes' Rule every
time I do this but it prevents me from making errors in more complex problems.
This is an exercise in conditional probability. For any two events A and B, where P(B) ≠ 0, you have the
conditional probability:
P( A | B ) = P( A ∩ B ) / P( B ) = P( B | A) * P(A) / P(B)
the above is read as: the probability of A given B is equal to the probability of A and B divided by the
probability of B.
Let D be the event the athlete used drugs
Let ~D be the event the athlete does not use drugs
Let + be a positive test
Let - be a negative test
We know
P(D) = 0.03
P(~D) = 0.97
P( + | D ) = 0.90
P( - | D) = 0.10
P( - | ~D ) = 0.90
P( + | ~D) = 0.10
Find P( D | +)
= P( + | D ) * P(D) / P(+)
Use The Law of Total Probability to find P(+)
For a set of events A1, A2, A3, ... , An where the Ai's are mutually exclusive and exhaustive events and
for any other event B
P(B)
= P(B and A1) + P(B and A2) + ... + P(B and An)
= P(B | A1) * P(A1) + P(B | A2) * P(A2) + ... + P(B | An) * P(An)
P(+) = P( + | D) * P(D) + P( + | ~D ) * P(~D)
P(+) = 0.90 * 0.03 + 0.10 * 0.97
P(+) = 0.124
P( D | + )
= 0.90 * 0.03 / 0.124

= 0.2177419
If a player tests positive, there is only a 21.7% probability they have used drugs.
____________
drug users testing positive: 0.03*0.90 = 0.027
non users testing positive: 0.97*0.10 = 0.097
total testing positive 0.124.
proportion of users out of all positive tests:0.027/0.124 = 0.2177
probability that an athlete who tests positive is actually a user = 0.22 to 2 significant figures.
The normal distribution (the bell-shaped curve) has a skewness of one.
False; skewness = 0
P(A) = 1 - P(Ac)
True
A conditional probability equals a marginal probability divided by a joint probability.
False; Conditional = Joint/Marginal
The interquartile range (IQR) equals the difference between the mean and the mode.
False; Difference b/w 1st and 3rd quartiles

The mean equals the expected value, which is the location with equal probability of lower and higher
values.
True
A probability tree can be used to determine the joint probabilities of an experiment.
True
Determining the number of heads from the tossing of a coin is an example of a Binomial experiment.
True
A marginal probability is an example of a posterior probability.
False; Marginal probability is the probability of an event
The Microsoft Excel function PETERSON will return the correlation coefficient between two datasets.
False; PETERSON not an Excel function
Increasing the number of trials will increase the variance in a Binomial experiment.
True
A variable can have multiple measures.
True
The area in the standard normal distribution within 0.93 standard deviations of the mean is equal to
0.64762 of the cumulative area.
True
Upgrade to remove ads
Only $2.99/month
If the covariance between two variables is zero the two variables are not related.
False; there may be a nonlinear relationship
If the marginal probability of event A is 0.5 and the joint probability of event A and event B occurring is
0.25, then the conditional probability of event B given event A is equal to 2.0
False; =.5
The combination of 6 items selected 2 at a time will result in 10 experimental outcomes.
False; =15
Actual product weights is an example of a discrete random variable.
False; Weights can vary thus continuous
If exam grades are negatively skewed, there will be more high grades than low grades.
True
You can add, but not multiply categorical data scales.
False
If the probability of the complement of an event equals 0.25, the probability of the event equals 0.75.
True
An experiment where all outcomes are equally likely will result in a uniform distribution.
True
A symmetric distribution will have a skewness of zero.
True
A correlation coefficient between two variables equal to -0.9 means that the two variables do not have a
linear relationship.
False; -.9 Represents strong negative linear relationship b/w 2 variables
Only $2.99/month
Exams in this class can be framed as Binomial experiments.
True
The marginal probability of an event equals the probability of the event.
True
The sample mean is an unbiased estimate of the population mean
True
=PERCENTILE.INC(a,b)
When determining the 20th percentile with the above Microsoft Excel function, the value of "b" will
equal "0.20."
True
A discrete probability function can not have negative values.
True
The sum of the probabilities at each step in a probability tree equal 1.0.
True
A conditional probability is an example of a posterior probability.
True
If an event has five (5) possible outcomes that are equally likely, the probability of each outcome is 0.25.
False
The permutation of 8 items selected 4 at a time will result in 120 experimental outcomes.
False
P(A) = 1 + P(A ∪ Ac)
False
Only $2.99/month
Numerical values can be applied to categorical data.
True
Z-values of -3.0 and 3.0 are equidistant from the mean of the standard normal distribution.
True
P(A|B) can be read as "the probability of A, given B."
True
A Bernoulli trial can have four potential outcomes.
False; 2 outcomes
The Microsoft Excel function PEARSON will return the correlation coefficient between two datasets.
True
Gender (male, female) is an example of an nominal data scale.
True
The variance of a discrete variable must also be a discrete variable.
False
The Microsoft Excel function COVARIANCE.S will return the covariance between two samples.
True
A statistical inference can be incorrect.
True
The mean and the mode will always occur at the same location.
False
Only $2.99/month
The value 1,516,904,279,801 can be a measure of a discrete variable.
True
In a Binomial experiment the probabilities cannot change from trial to trial.
False; Values of p and 1-p do not change
The student with the highest grade in this class will be ranked in the 100th percentile for this class.
True
If the union of two events equals the sum of the outcomes for each of the two events, the intersection
of the two events is empty.
True
The cumulative area under the standard normal curve up to a z-value of -1.62 equals approximately
5.3% of the cumulative area.
True
If the probability of the complement of an event equals 0.40, the probability of the event also equals
0.40.
False; Probability =.6
In a Binomial experiment, each trial depends on all prior trials.

False; Each trial indep.

Management Science - Chapter 7 - Test Reveiwer

Uploaded by

Copyright:

Available Formats

Management Science - Chapter 7 - Test Reveiwer

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Management Science - Chapter 7 - Test Reveiwer

Uploaded by

Copyright:

Available Formats

What is Bayes' Theorem and how is it used?

What is Bayes' Theorem and how is it used?

Explain the Law of Total Probability.

Explain the Law of Total Probability.

The Ambell Company uses batteries from two different manufacturers.

Historically, 60% of the

(.4*.25)/(.6*.1+.4*.25) = 0.625 = 62.5%

as a general rule, P(A or B) = P(A) + P(B)

so probability that any battery lasts less than 40 hours is:

= 60/100 * (1 - 90/100) + 40/100 * (1 - 75/100)

as a general rule, P(A given B) = P(A and B) / P(B)

so probability it was from manufacturer 2 is:

= (40/100 * (1 - 75/100)) / (16/100)

Let D be the event the athlete used drugs

Let ~D be the event the athlete does not use drugs

Let + be a positive test

Let - be a negative test

Use The Law of Total Probability to find P(+)

P(+) = P( + | D) * P(D) + P( + | ~D ) * P(~D)

P(+) = 0.90 * 0.03 + 0.10 * 0.97

= 0.90 * 0.03 / 0.124

drug users testing positive: 0.03*0.90 = 0.027

non users testing positive: 0.97*0.10 = 0.097

total testing positive 0.124.

proportion of users out of all positive tests:0.027/0.124 = 0.2177

The normal distribution (the bell-shaped curve) has a skewness of one.

A conditional probability equals a marginal probability divided by a joint probability.

False; Conditional = Joint/Marginal

False; Difference b/w 1st and 3rd quartiles

A probability tree can be used to determine the joint probabilities of an experiment.

A marginal probability is an example of a posterior probability.

False; Marginal probability is the probability of an event

False; PETERSON not an Excel function

A variable can have multiple measures.

False; there may be a nonlinear relationship

The combination of 6 items selected 2 at a time will result in 10 experimental outcomes.

Actual product weights is an example of a discrete random variable.

False; Weights can vary thus continuous

You can add, but not multiply categorical data scales.

A symmetric distribution will have a skewness of zero.

False; -.9 Represents strong negative linear relationship b/w 2 variables

Upgrade to remove ads

Exams in this class can be framed as Binomial experiments.

The marginal probability of an event equals the probability of the event.

The sample mean is an unbiased estimate of the population mean

A conditional probability is an example of a posterior probability.

P(A) = 1 + P(A ∪ Ac)

Upgrade to remove ads

Numerical values can be applied to categorical data.

P(A|B) can be read as "the probability of A, given B."

A Bernoulli trial can have four potential outcomes.

Gender (male, female) is an example of an nominal data scale.

The variance of a discrete variable must also be a discrete variable.

A statistical inference can be incorrect.

Upgrade to remove ads

The value 1,516,904,279,801 can be a measure of a discrete variable.

In a Binomial experiment the probabilities cannot change from trial to trial.

False; Values of p and 1-p do not change

(.4.25)/(.6.1+.4*.25) = 0.625 = 62.5%