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Economics 120A Name: ________key_________________ July 30, 2003 Student ID#: _________________________ ANSWER to Final Exam: Econometrics 1.(10 points) The stamping machine on a production line periodically is taken off-line for maintenance. Assume that the amount of time the machine is off-line is uniformly distributed between 15 and 30 minutes. What is the probability that the machine is off- line for more than 18 minutes? What is the probability that the machine is off-line between 21 and 27 minutes? (Answer) (a) 18 to 30 minutes represent 80% of the distance between 15 and 30 minutes. (b) The range 21 to 27 is 40% of the distance between 15 and 30 minutes. 2. (10 points) The length of time it takes to fill an order at a local sandwich shop is normally distributed with a mean of 4.1 minutes and a standard deviation of 1.3 minutes. If the sandwich shop employees make \$6.00 an hour, what is the mean and standard deviation for the labor costs per sandwich? (answer) E(X) = 4.1 sd(X) = 1.3 Labor cost per minute = \$0.10 Y = 0.10X E(Y) = (0.10)(4.1) = \$0.41 sd(Y) = 0.1*sd(X) = 0.13.

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