Online Quiz 4

# Online Quiz 4 - Maple T.A Gradebook...

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System Homepage » Class Homepage » Student Details » Student Assignment Details Stat 230 W09 : Gradebook Welcome Po-Wei Chuang [ My Profile ] Assignment detail for Po-Wei Chuang in Online Quiz 4: Po-Wei Chuang Login: pchuang Email: Student ID: 20260696 Assignments completed: 22 Assignments active: 0 Question Grade 1 Cans of soft drinks cost \$0.65 in a certain vending machine. What is the expected value and variance of daily revenue (Y) from the machine, if X, the number of cans sold per day has E(X) = 140, and Var(X) = 25? Your Answer: E(Y) = 91, Var(Y) = 10.56 Correct Answer: E(Y) = 91, Var(Y) = 10.56 Comment: Notice that Y = 0.65*X .Thus: E(Y) = 0.65*E(X) = 0.65*140 = 91 Var(Y) = (0.65) 2 *Var(X) = 0.4225*25 = 10.56 Instructors Comment: 1.0 2 An insurance company issues a policy on a small boat under the following conditions: The replacement cost (\$14,000) will be paid for a total loss. If it is not a total loss, but the damage is more than \$9,000, then \$8,100 will be paid. Nothing will be paid for damage costing \$9,000 or less and of course nothing is paid out if there is no damage. The company estimates the probability of the first three events as 0.02, 0.12, and 0.39 respectively. The amount the company should charge if it wishes to make a profit of \$70 above the expected amount paid out in a year is: Your Answer: \$1,322 Correct Answer: \$1,322 Comment: First calculate the expected payout. Notice that P(no damage) = 1 - 0.02 - 0.12-0.39 = 0.47. Expected Payout = .0.02(14,000) + 0.12(8,100) + 0.39(0) + 0.47(0) = \$1,252, so

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Online Quiz 4 - Maple T.A Gradebook...

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