Statistical Techniques in Business and Economics Douglas Lind 17th Edition – Test Bank

Complete Test Bank With Answers

 

 

Sample Questions Posted Below

 

Statistical Techniques in Business and Economics, 17e (Lind)

Chapter 5 A Survey of Probability Concepts

1) The probability of rolling a 3 or 2 on a single die is an example of conditional probability.

Answer: FALSE

Explanation: This is classical probability.

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

2) The probability of rolling a 3 or 2 on a single die is an example of mutually exclusive events.

Answer: TRUE

Explanation: This is mutually exclusive as you cannot roll both a 2 and a 3 at the same time.

Only one of these events can happen on a roll of a single die.

Difficulty: 1 Easy

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

3) An individual can assign a subjective probability to an event based on the individual’s

knowledge about the event.

Answer: TRUE

Explanation: When someone uses available knowledge to assign a probability to an event, this is

subjective probability as it is based on an opinion.

Difficulty: 1 Easy

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

1

Copyright © 2018 McGraw-Hill4) To apply the special rule of addition, the events must be mutually exclusive.

Answer: TRUE

Explanation: The special rule of addition assumes there is no intersection or joint probability

between events, so the events cannot occur concurrently (i.e., they are mutually exclusive so the

joint probability is zero).

Difficulty: 1 Easy

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

5) A joint probability measures the likelihood that two or more events will happen concurrently.

Answer: TRUE

Explanation: A joint probability measures the chance that several events can happen at the same

time. If the joint probability is zero, then the events are mutually exclusive.

Difficulty: 1 Easy

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

6) The joint probability of two independent events, A and B, is computed as P(A and B) =

P(A) × P(B).

Answer: TRUE

Explanation: If Events A and B are independent, then the P(A) = P(A|B) and P(B) = P(B|A). In

other words, P(A and B) = P(A) × P(B) as the conditional probability is zero.

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Remember

AACSB: Communication

2

Copyright © 2018 McGraw-Hill7) The joint probability of two events, A and B, that are NOT independent is computed as

P(A and B) = P(A) × P(B|A).

Answer: TRUE

Explanation: When two events are not independent, then P(B) ≠ P(B|A). In other words, the

probability of B depends on the other event A, so we must use P(B|A) in calculating the joint

probability of A and B rather than just P(B).

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Remember

AACSB: Communication

8) A coin is tossed four times. The joint probability that all four tosses will result in a head is 1/4

or 0.25.

Answer: FALSE

Explanation: Each outcome’s probability is 0.5. The joint probability is (0.5)(0.5)(0.5)(0.5) =

0.0625.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

9) If there are “m” ways of doing one thing, and “n” ways of doing another thing, the

multiplication formula states that there are (m) × (n) ways of doing both.

Answer: TRUE

Explanation: The multiplication formula states the number of possible arrangements that are

possible for two or more events.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Remember

AACSB: Communication

10) A combination of a set of objects is defined by the order of the objects.

Answer: FALSE

Explanation: The order of objects is important for permutations but not combinations.

Difficulty: 1 Easy

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

3

Copyright © 2018 McGraw-Hill11) The complement rule states that the probability of an event not occurring is equal to 1 minus

the probability of its occurrence.

Answer: TRUE

Explanation: If P(A) and P(~A) are complements, then P(A) = 1 − P(~A) and P(~A) = 1 − P(A).

Difficulty: 1 Easy

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Remember

AACSB: Communication

12) If two events are mutually exclusive, then P(A and B) = P(A) × P(B).

Answer: FALSE

Explanation: If two events are mutually exclusive, then P(A and B) = 0

Difficulty: 1 Easy

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Understand

AACSB: Communication

13) An illustration of an experiment is turning the ignition key of an automobile as it comes off

the assembly line to determine whether or not the engine will start.

Answer: TRUE

Explanation: An experiment is a process that leads to the occurrence of one and only one of

several possible outcomes. In this case, the experiment is turning the key (the process) and the

possible outcomes are (1) the car starts, or (2) the car doesn’t start.

Difficulty: 2 Medium

Topic: What is a Probability?

Learning Objective: 05-01 Define the terms probability, experiment, event, and outcome.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

4

Copyright © 2018 McGraw-Hill14) Bayes’ theorem is a method to revise the probability of an event given additional

information.

Answer: TRUE

Explanation: In Bayes’ theorem, we take initial probabilities known on the basis of current

information (prior probabilities) and revise them based on new information (posterior

probabilities).

Difficulty: 1 Easy

Topic: Bayes Theorem

Learning Objective: 05-06 Calculate probabilities using Bayes theorem.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

15) Bayes’ theorem is used to calculate a subjective probability.

Answer: FALSE

Explanation: Bayes’ theorem is used to calculate posterior probabilities (a revised probability

based on new information). Subjective probability is a method used to assign a probability based

on the opinion of someone using available information.

Difficulty: 1 Easy

Topic: Bayes Theorem

Learning Objective: 05-06 Calculate probabilities using Bayes theorem.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

16) The National Center for Health Statistics reported that of every 883 deaths in recent years, 24

resulted from an automobile accident, 182 from cancer, and 333 from heart disease. What is the

probability that a particular death is due to an automobile accident?

A) 24/883 or 0.027

B) 539/883 or 0.610

C) 24/333 or 0.072

D) 182/883 or 0.206

Answer: A

Explanation: Based on the empirical approach to probability, 24/883 = 0.027.

Difficulty: 2 Medium

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

5

Copyright © 2018 McGraw-Hill17) If two events A and B are mutually exclusive, what does the special rule of addition state?

A) P(A or B) = P(A) + P(B)

B) P(A and B) = P(A) + P(B)

C) P(A and/or B) = P(A) + P(B)

D) P(A or B) = P(A) − P(B)

Answer: A

Explanation: By definition, P(A or B) = P(A) + P(B) is the special rule of addition.

Difficulty: 1 Easy

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Remember

AACSB: Communication

18) What does the complement rule state?

A) P(A) = P(A) − P(B)

B) P(A) = 1 – P(not A)

C) P(A) = P(A) × P(B)

D) P(A) = P(A)X + P(B)

Answer: B

Explanation: By definition, P(A) plus its complement, P(not A) must equal 1.

Difficulty: 1 Easy

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Remember

AACSB: Communication

19) Which approach to probability is exemplified by the following formula?

Probability of an event =

A) The classical approach

B) The empirical approach

C) The subjective approach

D) None of these answers are correct.

Answer: B

Explanation: The empirical rule is based on the frequency of observed experimental outcomes.

Difficulty: 1 Easy

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Remember

AACSB: Communication

6

Copyright © 2018 McGraw-Hill20) A study of 200 computer service firms revealed these incomes after taxes:

Income After Taxes Number of Firms

Under $1 million 102

$1 million up to $20 million 61

$20 million or more 37

What is the probability that a particular firm selected has $1 million or more in income after

taxes?

A) 0.00

B) 0.25

C) 0.49

D) 0.51

Answer: C

Explanation: A couple of approaches can be used to answer the question. Using the complement

rule, the probability of firms less than $1 million is 102/200 = 0.51. The complement or firms

with $1 million or more income is 1.0 − 0.51 = 0.49.

Difficulty: 2 Medium

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

21) A firm offers routine physical examinations as part of a health service program for its

employees. The exams showed that 8% of the employees needed corrective shoes, 15% needed

major dental work, and 3% needed both corrective shoes and major dental work. What is the

probability that an employee selected at random will need either corrective shoes or major dental

work?

A) 0.20

B) 0.25

C) 0.50

D) 1.00

Answer: A

Explanation: The two events, corrective shoes and dental work, are not mutually exclusive

because an employee can need both. The P(corrective shoes or dental work) = P(corrective

shoes) + P(dental work) − P(corrective shoes and dental work) = 0.8 + 0.15 − 0.03 = 0.20.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

7

Copyright © 2018 McGraw-Hill22) A survey of top executives revealed that 35% of them regularly read Time magazine, 20%

read Newsweek, and 40% read U.S. News & World Report. A total of 10% read both Time and

U.S. News & World Report. What is the probability that a particular top executive reads either

Time or U.S. News & World Report regularly?

A) 0.85

B) 0.06

C) 1.00

D) 0.65

Answer: D

Explanation: The three events—reading Time, Newsweek, or U.S. News & World Report—are

not mutually exclusive because executives can read more than one of the magazines. The P(Time

or U.S. News) = P(Time) + P(U.S. News) − P(Time and U.S. News) = 0.35 + 0.40 − 0.10 = 0.65.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

23) A study by the National Park Service revealed that 50% of the vacationers going to the

Rocky Mountain region visit Yellowstone Park, 40% visit the Grand Tetons, and 35% visit both.

What is the probability that a vacationer will visit at least one of these magnificent attractions?

A) 0.95

B) 0.35

C) 0.55

D) 0.05

Answer: C

Explanation: The two events, visiting Yellowstone and visiting the Grand Tetons, are not

mutually exclusive because vacationers can visit both locations. The P(Yellowstone or Grand

Tetons) = P(Yellowstone) + P(Grand Tetons) − P(Yellowstone and Grand Tetons) = 0.50 + 0.40

− 0.35 = 0.55.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

8

Copyright © 2018 McGraw-Hill24) A tire manufacturer advertises, “The median life of our new all-season radial tire is 50,000

miles. An immediate adjustment will be made on any tire that does not last 50,000 miles.” You

purchased four of these tires. What is the probability that all four tires will wear out before

traveling 50,000 miles?

A) 1/10 or 0.10

B) 1/4 or 0.25

C) 1/64 or 0.0156

D) 1/16 or 0.0625

Answer: D

Explanation: The median corresponds with the 50th percentile. So the probability that a tire

wears out before 50,000 miles is 0.5. Each outcome’s probability is 0.5. The joint probability is

(0.5)(0.5)(0.5)(0.5) = 0.0625.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

25) A sales representative calls on four hospitals in Westchester County. It is immaterial what

order he calls on them. How many ways can he organize his calls?

A) 4

B) 24

C) 120

D) 37

Answer: B

Explanation: Use the multiplication formula: (4)(3)(2)(1) = 24.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

9

Copyright © 2018 McGraw-Hill26) There are 10 AAA batteries in a box and 3 are defective. Two batteries are selected without

replacement. What is the probability of selecting a defective battery followed by another

defective battery?

A) 1/2 or 0.50

B) 1/4 or 0.25

C) 1/120 or about 0.0083

D) 1/15 or about 0.07

Answer: D

Explanation: The probability of a defective battery on the first selection is 3/10 = 0.3. The

probability of selecting a second defective battery is a conditional probability that assumes the

first selection was defective, so the probability of a second defective battery is 2/9. The joint

probability is (3/10)(2/9) = 0.066667.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Reflective Thinking

27) Giorgio offers the person who purchases an 8-ounce bottle of Allure two free gifts, chosen

from the following: an umbrella, a 1-ounce bottle of Midnight, a feminine shaving kit, a raincoat,

or a pair of rain boots. If you purchased Allure, what is the probability you randomly select an

umbrella and a shaving kit in that order?

A) 0.00

B) 1.00

C) 0.05

D) 0.20

Answer: C

Explanation: There are five different gifts. Therefore, the probability of any gift is 1/5 = 0.2. The

probability of selecting a second gift is a conditional probability that assumes the first selection

was an umbrella, so the probability of a second gift, a shaving kit, is 1/4 = 0.25. The joint

probability is (1/5)(1/4) = 1/20 = 0.05.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

10

Copyright © 2018 McGraw-Hill28) A board of directors consists of eight men and four women. A four-member search

committee is randomly chosen to recommend a new company president. What is the probability

that all four members of the search committee will be women?

A) 1/120 or 0.00083

B) 1/16 or 0.0625

C) 1/8 or 0.125

D) 1/495 or 0.002

Answer: D

Explanation: There are four women in a group of 12 individuals. Therefore, the probability of

picking a woman on the first selection is 4/12, the second selection is 3/11, the third selection is

2/10, and the fourth is 1/9. This is an application of the multiplication rule for events that are not

independent. The joint probability is (4/12)(3/11)(2/10)(1/9) = 0.002.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

29) A lamp manufacturer designed five lamp bases and four lampshades that could be used

together. How many different arrangements of base and shade can be offered?

A) 5

B) 10

C) 15

D) 20

Answer: D

Explanation: Using the multiplication formula, (5)(4) = 20.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

11

Copyright © 2018 McGraw-Hill30) A gumball machine has just been filled with 50 black, 150 white, 100 red, and 100 yellow

gumballs that have been thoroughly mixed. Sue and Jim each purchase one gumball. What is the

likelihood that both Sue and Jim will get red gumballs?

A) 0.50

B) 0.062

C) 0.33

D) 0.75

Answer: B

Explanation: The probability of a red gumball on the first selection is 100/400 = 0.25. The

probability of selecting a second red gumball is a conditional probability that assumes the first

selection was a red gumball, so the probability of a second red gumball is 99/399. The joint

probability is (100/400)(99/399) = 0.062.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

31) What does equal?

A) 640

B) 36

C) 10

D) 120

Answer: C

Explanation: (6*5*4*3*2*1)(2*1)/(4*3*2*1)(3*2*1) = 10

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic; Reflective Thinking

12

Copyright © 2018 McGraw-Hill32) In a management trainee program, 80% of the trainees are female, while 20% are male.

Ninety percent of the females attended college; 78% of the males attended college. A

management trainee is selected at random. What is the probability that the person selected is a

female who did NOT attend college?

A) 0.20

B) 0.08

C) 0.25

D) 0.80

Answer: B

Explanation: First, the conditional probability that a person attended college given the person is

female is P(college | female) = 0.9. The complement is P(no college | female) = 0.1. Now the

joint probability of selecting a female who did not attend college is P(female and no college) =

P(female) P(no college | female) = (0.8)(0.1) = 0.08.

Difficulty: 3 Hard

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

33) In a management trainee program, 80% of the trainees are female, while 20% are male.

Ninety percent of the females attended college; 78% of the males attended college. A

management trainee is selected at random. What is the probability that the person selected is a

female who attended college?

A) 0.20

B) 0.08

C) 0.25

D) 0.72

Answer: D

Explanation: First, the conditional probability that a person attended college given the person is

female is P(college | female) = 0.9. Now the joint probability of selecting a female who did

attend college is P(female and college) = P(female) P(college | female) = (0.8)(0.9) = 0.72.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

13

Copyright © 2018 McGraw-Hill34) In a management trainee program, 80% of the trainees are female, while 20% are male.

Ninety percent of the females attended college; 78% of the males attended college. A

management trainee is selected at random. What is the probability that the person selected is a

male who did NOT attend college?

A) 0.044

B) 0.440

C) 0.256

D) 0.801

Answer: A

Explanation: First, the conditional probability that a person attended college given the person is

male is P(college | male) = 0.78. The complement is P(no college | male) = 0.22. Now the joint

probability of selecting a male who did not attend college is P(male and no college) = P(male)

P(no college | male) = (0.2)(0.22) = 0.044.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

35) In a management trainee program, 80% of the trainees are female, while 20% are male.

Ninety percent of the females attended college; 78% of the males attended college. A

management trainee is selected at random. What is the probability that the person selected is a

male who did NOT attend college?

A) P (male) P (did not attend college | male)

B) P (did not attend college) P (male | did not attend college)

C) P (male) P (did not attend college)

D) P (did not attend college)

Answer: A

Explanation: First, the conditional probability that a person attended college given the person is

male is P(college | male). The complement is P(no college | male). Now the joint probability of

selecting a male who did not attend college is P(male and no college) = P(male) P(no college |

male).

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

14

Copyright © 2018 McGraw-Hill36) In a management trainee program, 80% of the trainees are female, while 20% are male.

Ninety percent of the females attended college; 78% of the males attended college. A

management trainee is selected at random. What is the probability that the person selected is a

female who attended college?

A) P (female) P (did not attend college | female)

B) P (did attend college) P (female | did not attend college)

C) P (female) P (did attend college | female)

D) P (did attend college)

Answer: C

Explanation: First, the conditional probability that a person attended college given the person is

female is P(college | female). The complement is P(no college | female). Now the joint

probability of selecting a female who did not attend college is P(female and no college) =

P(female) P(no college | female).

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

37) A supplier delivers an order for 20 electric toothbrushes to a store. By accident, three of the

electric toothbrushes are defective. What is the probability that the first two electric toothbrushes

sold are defective?

A) 3/20 or 0.15

B) 3/17 or 0.176

C) 1/4 or 0.25

D) 6/380 or 0.01579

Answer: D

Explanation: The probability of a defective unit on the first selection is 3/20 = 0.15. The

probability of selecting a second unit is a conditional probability that assumes the first selection

was defective, so the probability of a second defective toothbrush is 2/19. The joint probability is

(3/20)(2/19) = 0.01579.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

15

Copyright © 2018 McGraw-Hill38) An electronics firm sells four models of stereo receivers, three amplifiers, and six speaker

brands. When the four types of components are sold together, they form a “system.” How many

different systems can the electronics firm offer?

A) 36

B) 18

C) 72

D) 144

Answer: C

Explanation: Using the multiplication formula, (4)(3)(6) = 72.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

39) The numbers 0 through 9 are used in code groups of four to identify an item of clothing.

Code 1083 might identify a blue blouse, size medium. The code group 2031 might identify a pair

of pants, size 18, and so on. Repetitions of numbers are not permitted—in other words, the same

number cannot be used more than once in a total sequence. As examples, 2,256, 2,562, or 5,559

would not be permitted. How many different code groups can be designed?

A) 5,040

B) 620

C) 10,200

D) 120

Answer: A

Explanation: Using the multiplication formula, (10)(9)(8)(7) = 5,040 different codes without

repeated digits.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

16

Copyright © 2018 McGraw-Hill40) How many permutations of the three letters C, D, and E are possible?

A) 3

B) 0

C) 6

D) 8

Answer: C

Explanation: Using the permutation formula 3!/0! = (3)(2)(1) = 6.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

41) You are assigned to design color codes for different parts. Three colors are used to code on

each part. Once a combination of three colors is used—such as green, yellow, and red—these

three colors cannot be rearranged to use as a code for another part. If there are 35 combinations,

how many colors are available?

A) 5

B) 7

C) 9

D) 11

Answer: B

Explanation: Using the combination formula, x!/(3!(x − 3)!) or trial and error, there are 7 colors.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

17

Copyright © 2018 McGraw-Hill42) A developer of a new subdivision wants to build homes that are all different. There are three

different interior plans that can be combined with any of five different home exteriors. How

many different homes can be built?

A) 8

B) 10

C) 15

D) 30

Answer: C

Explanation: Using the multiplication formula, (3)(5) = 15.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

43) Six basic colors are used in decorating a new condominium. They are applied to a unit in

groups of four colors. One unit might have gold as the principal color, blue as a complementary

color, red as the accent color, and touches of white. Another unit might have blue as the principal

color, white as the complementary color, gold as the accent color, and touches of red. If

repetitions are permitted, how many different units can be decorated?

A) 7,825

B) 25

C) 125

D) 1,296

Answer: D

Explanation: Using the multiplication formula, (6)(6)(6)(6) = 1,296.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

18

Copyright © 2018 McGraw-Hill44) The ABCD football association is considering a Super Ten Football Conference. The top 10

football teams in the country, based on past records, would be members of the Super Ten

Conference. Each team would play every other team in the conference during the season and the

team winning the most games would be declared the national champion. How many games

would the conference commissioner have to schedule each year? (Remember, Oklahoma versus

Michigan is the same as Michigan versus Oklahoma.)

A) 45

B) 50

C) 125

D) 14

Answer: A

Explanation: Using the combination formula, n = 10 and r = 2, 10!/2!(10 − 2)! = 90/2 = 45.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

45) A rug manufacturer has decided to use seven compatible colors in her rugs. However, in

weaving a rug, only five spindles can be used. In advertising, the rug manufacturer wants to

indicate the number of different color groupings for sale. How many color groupings using the

seven colors taken five at a time are there? (This assumes that five different colors will go into

each rug—in other words, there are no repetitions of color.)

A) 7

B) 21

C) 840

D) 42

Answer: B

Explanation: Using the combination formula, n = 7 and r = 5; 7!/5!(7 − 5)! = 42/2 = 21.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

19

Copyright © 2018 McGraw-Hill46) The first card selected from a standard 52-card deck was a king. If it is returned to the deck,

what is the probability that a king will be drawn on the second selection?

A) 1/4 or 0.25

B) 1/13 or 0.077

C) 12/13 or 0.923

D) 1/3 or 0.33

Answer: B

Explanation: The probability is 4/52 = 1/13, or 0.077.

Difficulty: 2 Medium

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

47) The first card selected from a standard 52-card deck was a king. If it is NOT returned to the

deck, what is the probability that a king will be drawn on the second selection?

A) 1/3 or 0.33

B) 1/51 or 0.0196

C) 3/51 or 0.0588

D) 1/13 or 0.077

Answer: C

Explanation: The probability of a king on the first selection is 4/52 = 1/13. The probability of

selecting a second king is a conditional probability that assumes the first selection was a king, so

the probability of a second king is 3/51, or 0.0588.

Difficulty: 2 Medium

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

20

Copyright © 2018 McGraw-Hill48) Which approach to probability assumes that events are equally likely?

A) Classical

B) Empirical

C) Subjective

D) Mutually exclusive

Answer: A

Explanation: By definition, the classical approach assumes that events are equally likely.

Difficulty: 1 Easy

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

49) An experiment may have ________.

A) only one outcome

B) only two outcomes

C) one or more outcomes

D) several events

Answer: C

Explanation: By definition, an experiment results in one or more outcomes.

Difficulty: 1 Easy

Topic: What is a Probability?

Learning Objective: 05-01 Define the terms probability, experiment, event, and outcome.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

21

Copyright © 2018 McGraw-Hill50) When are two experimental outcomes mutually exclusive?

A) When they overlap on a Venn diagram.

B) If one outcome occurs, then the other cannot.

C) When the probability of one affects the probability of the other.

D) When the joint probability of the two outcomes is not equal to zero.

Answer: B

Explanation: By example, an experiment measures the variable gender. Therefore, there are two

possible outcomes: male or female. The outcome is mutually exclusive since a person can be

classified as either male or female, not both.

Difficulty: 1 Easy

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

51) Probabilities are important information when ________.

A) summarizing a data set with a frequency chart

B) applying descriptive statistics

C) computing cumulative frequencies

D) using inferential statistics

Answer: D

Explanation: Inferential statistics uses sample data to make decisions with a stated probability of

making an error.

Difficulty: 1 Easy

Topic: What is a Probability?

Learning Objective: 05-01 Define the terms probability, experiment, event, and outcome.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

22

Copyright © 2018 McGraw-Hill52) The result of a particular experiment is called a(n) ________.

A) observation

B) conditional probability

C) event

D) outcome

Answer: D

Explanation: By definition, experiments result in a set of observable outcomes.

Difficulty: 1 Easy

Topic: What is a Probability?

Learning Objective: 05-01 Define the terms probability, experiment, event, and outcome.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

53) The probability of two or more events occurring concurrently is called a(n) ________.

A) conditional probability

B) empirical probability

C) joint probability

D) tree diagram

Answer: C

Explanation: The P(A and B and C) is a joint probability.

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

54) The probability of a particular event occurring, given that another event has occurred, is

known as a(n) ________.

A) conditional probability

B) empirical probability

C) joint probability

D) tree diagram

Answer: A

Explanation: P(A | B) is a conditional probability indicating that the probability of the event A is

affected by event B.

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

23

Copyright © 2018 McGraw-Hill55) A graphical method used to calculate joint and conditional probabilities is ________.

A) a tree diagram

B) a Venn diagram

C) a histogram

D) inferential statistics

Answer: A

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-05 Compute probabilities using a contingency table.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

56) When an experiment is conducted “without replacement,” ________.

A) events are dependent

B) events are equally likely

C) the experiment can be illustrated with a Venn diagram

D) the probability of two or more events is computed as a joint probability

Answer: A

Explanation: “Without replacement” means that when an individual or object is observed or

measured, it is not returned to the population. So on the next selection from the population, each

individual or object has a higher probability of selection because the population is now N − 1.

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

57) If two events are independent, then their joint probability is computed with ________.

A) the special rule of addition

B) the special rule of multiplication

C) the general rule of multiplication

D) the Bayes’ theorem

Answer: B

Explanation: The special rule of multiplication is P(A and B) = P(A)P(B) for independent

events.

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

24

Copyright © 2018 McGraw-Hill25

Copyright © 2018 McGraw-Hill58) When applying the special rule of addition for mutually exclusive events, the joint

probability is ________.

A) 1

B) 0.5

C) 0

D) unknown

Answer: C

Explanation: For mutually exclusive events, the joint probability is P(A and B) = 0.

Difficulty: 1 Easy

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

59) When an event’s probability depends on the occurrence of another event, the probability is

a(n) ________.

A) conditional probability

B) empirical probability

C) joint probability

D) mutually exclusive probability

Answer: A

Explanation: It is a conditional probability, expressed as P(B | A), or the probability of B given

A.

Difficulty: 1 Easy

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

26

Copyright © 2018 McGraw-Hill60) A group of employees of Unique Services will be surveyed about a new pension plan. In-

depth interviews with each employee selected in the sample will be conducted. The employees

are classified as follows:

Classification Event Number of Employees

Supervisors A 120

Maintenance B 50

Production C 1,460

Management D 302

Secretarial E 68

What is the probability that the first person selected is classified as a maintenance employee?

A) 0.20

B) 0.50

C) 0.025

D) 1.00

Answer: C

Explanation: Applying the empirical probability approach, there are 50 maintenance employees

out of a total of 2,000 employees. The probability is 50/2,000 = 0.025.

Difficulty: 2 Medium

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Apply

AACSB: Analytic

27

Copyright © 2018 McGraw-Hill61) A group of employees of Unique Services will be surveyed about a new pension plan. In-

depth interviews with each employee selected in the sample will be conducted. The employees

are classified as follows:

Classification Event Number of Employees

Supervisors A 120

Maintenance B 50

Production C 1,460

Management D 302

Secretarial E 68

What is the probability that the first person selected is either in maintenance or in secretarial?

A) 0.200

B) 0.015

C) 0.059

D) 0.001

Answer: C

Explanation: Given mutually exclusive classes, P(maintenance or secretarial) = P(maintenance)

+ P(secretarial) = 50/2,000 + 68/2,000 = 0.059.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

28

Copyright © 2018 McGraw-Hill62) A group of employees of Unique Services will be surveyed about a new pension plan. In-

depth interviews with each employee selected in the sample will be conducted. The employees

are classified as follows:

Classification Event Number of Employees

Supervisors A 120

Maintenance B 50

Production C 1,460

Management D 302

Secretarial E 68

What is the probability that the first person selected is either in management or in supervision?

A) 0.00

B) 0.06

C) 0.15

D) 0.21

Answer: D

Explanation: For mutually exclusive classes, P(management or supervision) = P(management) +

P(supervision) = 302/2,000 + 120/2,000 = 0.21.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

63) The process used to calculate the revised probability of an event given additional information

can be obtained through ________.

A) Bayes’ theorem

B) classical probability

C) permutation

D) subjective probability

Answer: A

Explanation: Bayes’ theorem is used to calculate posterior probabilities, or revised probabilities

based on additional information added to the prior probabilities we have presently.

Difficulty: 1 Easy

Topic: Bayes Theorem

Learning Objective: 05-06 Calculate probabilities using Bayes theorem.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

29

Copyright © 2018 McGraw-Hill64) Each salesperson in a large department store chain is rated on their sales ability and their

potential for advancement. The data for the 500 sampled salespeople are summarized in the

following table.

Potential for Advancement

Fair Good Excellent

Sales ability Below average 16 12 22

Average 45 60 45

Above average 93 72 135

What is the probability that a salesperson selected at random has above-average sales ability and

has excellent potential for advancement?

A) 0.20

B) 0.50

C) 0.27

D) 0.75

Answer: C

Explanation: The events are not independent. P(above-average ability and excellent potential) =

P(above-average ability) P(excellent potential | above-average ability) = (300/500) (135/300) =

135/500 = 0.27.

Difficulty: 2 Medium

Topic: Contingency Tables

Learning Objective: 05-05 Compute probabilities using a contingency table.

Bloom’s: Apply

AACSB: Analytic

30

Copyright © 2018 McGraw-Hill65) Each salesperson in a large department store chain is rated on his or her sales ability and

potential for advancement. The data for the 500 sampled salespeople are summarized in the

following table.

Potential for Advancement

Fair Good Excellent

Sales ability Below average 16 12 22

Average 45 60 45

Above average 93 72 135

What is the probability that a salesperson selected at random will have average sales ability and

good potential for advancement?

A) 0.09

B) 0.12

C) 0.30

D) 0.525

Answer: B

Explanation: The events are not independent. P(average ability and good potential) = P(average

ability) P(good potential | average ability) = (150/500)(60/150) = 60/500 = 0.12.

Difficulty: 2 Medium

Topic: Contingency Tables

Learning Objective: 05-05 Compute probabilities using a contingency table.

Bloom’s: Apply

AACSB: Analytic

31

Copyright © 2018 McGraw-Hill66) Each salesperson in a large department store chain is rated on his or her sales ability and

potential for advancement. The data for the 500 sampled salespeople are summarized in the

following table.

Potential for Advancement

Fair Good Excellent

Sales ability Below average 16 12 22

Average 45 60 45

Above average 93 72 135

What is the probability that a salesperson selected at random will have below-average sales

ability and fair potential for advancement?

A) 0.032

B) 0.10

C) 0.16

D) 0.32

Answer: A

Explanation: The events are not independent. P(below average ability and fair potential) =

P(below average ability) P(fair potential | below average ability) = (60/500)(16/60) = 16/500 =

0.032.

Difficulty: 2 Medium

Topic: Contingency Tables

Learning Objective: 05-05 Compute probabilities using a contingency table.

Bloom’s: Apply

AACSB: Analytic

32

Copyright © 2018 McGraw-Hill67) Each salesperson in a large department store chain is rated on his or her sales ability and

potential for advancement. The data for the 500 sampled salespeople are summarized in the

following table.

Potential for Advancement

Fair Good Excellent

Sales ability Below average 16 12 22

Average 45 60 45

Above average 93 72 135

What is the probability that a salesperson selected at random will have an excellent potential for

advancement given he or she also has above-average sales ability?

A) 0.27

B) 0.60

C) 0.404

D) 0.45

Answer: D

Explanation: This is a conditional probability: P(excellent potential | above-average ability)

(135/300) = 0.45. There are 300 salespeople who are above average; 135 have excellent

potential.

Difficulty: 2 Medium

Topic: Contingency Tables

Learning Objective: 05-05 Compute probabilities using a contingency table.

Bloom’s: Apply

AACSB: Analytic

33

Copyright © 2018 McGraw-Hill68) Each salesperson in a large department store chain is rated on his or her sales ability and

potential for advancement. The data for the 500 sampled salespeople are summarized in the

following table.

Potential for Advancement

Fair Good Excellent

Sales ability Below average 16 12 22

Average 45 60 45

Above average 93 72 135

What is the probability that a salesperson selected at random will have an excellent potential for

advancement given he or she also has average sales ability?

A) 0.27

B) 0.30

C) 0.404

D) 0.45

Answer: B

Explanation: This is a conditional probability: P(excellent potential | average ability)(45/150) =

0.30. There are 150 salespeople who are average; 45 have excellent potential.

Difficulty: 2 Medium

Topic: Contingency Tables

Learning Objective: 05-05 Compute probabilities using a contingency table.

Bloom’s: Apply

AACSB: Analytic

34

Copyright © 2018 McGraw-Hill69) A study of interior designers’ opinions with respect to the most desirable primary color for

executive offices showed the following:

Primary Color Number of Opinions

Red 92

Orange 86

Yellow 46

Green 91

Blue 37

Indigo 46

Violet 2

What is the probability that a designer does NOT prefer red?

A) 1.00

B) 0.77

C) 0.73

D) 0.23

Answer: B

Explanation: Using the complement rule, P(red) = 92/400 = 0.23. Therefore, P(not red) = 1.00 −

0.23 = 0.77.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

35

Copyright © 2018 McGraw-Hill70) A study of interior designers’ opinions with respect to the most desirable primary color for

executive offices showed the following:

Primary Color Number of Opinions

Red 92

Orange 86

Yellow 46

Green 91

Blue 37

Indigo 46

Violet 2

What is the probability that a designer does NOT prefer yellow?

A) 0.000

B) 0.765

C) 0.885

D) 1.000

Answer: C

Explanation: Using the complement rule, P(yellow) = 46/400 = 0.115. Therefore, P(not yellow)

= 1.00 − 0.115 = 0.885.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

36

Copyright © 2018 McGraw-Hill71) A study of interior designers’ opinions with respect to the most desirable primary color for

executive offices showed the following:

Primary Color Number of Opinions

Red 92

Orange 86

Yellow 46

Green 91

Blue 37

Indigo 46

Violet 2

What is the probability that a designer does NOT prefer blue?

A) 1.0000

B) 0.9075

C) 0.8850

D) 0.7725

Answer: B

Explanation: Using the complement rule, P(blue) = 37/400 = 0.0925. Therefore, P(not blue) =

1.00 − 0.0925 = 0.9075.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

37

Copyright © 2018 McGraw-Hill72) An automatic machine inserts mixed vegetables into a plastic bag. Past experience revealed

that some packages were underweight and some were overweight, but most of them had

satisfactory weight.

Weight % of Total

Underweight 2.5

Satisfactory 90.0

Overweight 7.5

What is the probability of selecting three packages that are overweight?

A) 0.0000156

B) 0.0004219

C) 0.0000001

D) 0.075

Answer: B

Explanation: Apply the multiplication rule: (0.075)(0.075)(0.075) = 0.0004219.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

73) An automatic machine inserts mixed vegetables into a plastic bag. Past experience revealed

that some packages were underweight and some were overweight, but most of them had

satisfactory weight.

Weight % of Total

Underweight 2.5

Satisfactory 90.0

Overweight 7.5

What is the probability of selecting three packages that are satisfactory?

A) 0.900

B) 0.810

C) 0.729

D) 0.075

Answer: C

Explanation: Apply the multiplication rule: (0.90)(0.90)(0.90) = 0.729.

Difficulty: 2 Medium

Topic: Rules of Multiplication to Calculate Probability

Learning Objective: 05-04 Calculate probabilities using the rules of multiplication.

Bloom’s: Apply

AACSB: Analytic

38

Copyright © 2018 McGraw-Hill74) In a finance class, the final grade is based on three tests. Historically, the instructor tells the

class that the joint probability of scoring As on the first two tests is 0.5. A student assigns a

probability of 0.9 that she will get an A on the first test. What is the probability that the student

will score an A on the second test given that she scored an A on the first test?

A) 0.50

B) 0.95

C) 0.56

D) 0.90

Answer: C

Explanation: The general rule of multiplication states that P(A and B) = P(A|B) P(B), so P(A|B)

= P(A and B)/P(B). Therefore, P(A on second test| A on first test) = P(A on both tests) / P(A on

first test) = 0.5/0.9 = 0.56.

Difficulty: 3 Hard

Topic: Bayes Theorem

Learning Objective: 05-06 Calculate probabilities using Bayes theorem.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

75) Using the terminology of Bayes’ theorem, a posterior probability can also be defined as a

A) revised probability

B) joint probability

C) subjective probability

D) classical probability

Answer: A

Explanation: A posterior probability is a revised probability based on additional information.

Difficulty: 1 Easy

Topic: Bayes Theorem

Learning Objective: 05-06 Calculate probabilities using Bayes theorem.

Bloom’s: Understand

AACSB: Communication

Accessibility: Keyboard Navigation

39

Copyright © 2018 McGraw-Hill76) If A and B are mutually exclusive events with P(A) = 0.2 and P(B) = 0.6, then P(A or B) =

________.

A) 0.00

B) 0.12

C) 0.80

D) 0.40

Answer: C

Explanation: Use formula [5-4]: P(A or B) = P(A) + P(B) − P(A and B). Since the events are

mutually exclusive, P(A and B) = 0 and P(A or B) = (0.20) + (0.60) = 0.80.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

77) If P(A) = 0.62, P(B) = 0.47, and P(A or B) = 0.88, then P(A and B) = ________.

A) 0.2914

B) 1.9700

C) 0.6700

D) 0.2100

Answer: D

Explanation: Use formula [5-4]: P(A or B) = P(A) + P(B) − P(A and B). Rearrange formula [5-

4]: P(A and B) = P(A) + P(B) − P(A or B) = 0.62 + 0.47 − 0.88 = 0.21. P(A and B) = 0.21.

Difficulty: 2 Medium

Topic: Rules of Addition for Computing Probabilities

Learning Objective: 05-03 Calculate probabilities using the rules of addition.

Bloom’s: Apply

AACSB: Analytic

78) A method of assigning probabilities based upon judgment, opinions, and available

information is referred to as the ________.

A) empirical method

B) probability method

C) classical method

D) subjective method

Answer: D

Difficulty: 1 Easy

Topic: Approaches to Assigning Probabilities

Learning Objective: 05-02 Assign probabilities using a classical, empirical, or subjective

approach.

Bloom’s: Remember

AACSB: Communication

Accessibility: Keyboard Navigation

40

Copyright © 2018 McGraw-Hill79) Your favorite soccer team has two remaining matches to complete the season. The possible

outcomes of a soccer match are win, lose, or tie. What is the possible number of outcomes for the

season?

A) 2

B) 4

C) 6

D) 9

Answer: D

Explanation: Use the tree diagram to determine the possible outcomes, which are: {W,W},

{W,L}, {W,T}, {L,W}, {L,L}, {L,T}, {T,W}, {T,L}, {T,T}. There are 9 possible outcomes.

Difficulty: 2 Medium

Topic: Principles of Counting

Learning Objective: 05-07 Determine the number of outcomes using principles of counting.

Bloom’s: Apply

AACSB: Analytic

Accessibility: Keyboard Navigation

41

Copyright © 2018 McGraw-Hill