Workshop 3 Individual Review Questions
Probability (huge success/favorable
Probability (modest sucess/favorabl
Probability (break even/favorable rev
Probability (losers/favorable review)
What proportion of textbooka receives favorable reviews
Probability of favorable reviews
Probability (A rating/issued by city)
1. 1. Complete the following problems from the text book. Note: use Excel whenever po
thread is available for you to ask questions and to assist your peers with their question
a. Chapter 4:
4.36, 4.37, and 4.59.
b. Chapter 5: 5.25, 5.27, and 5.28.
2. Save your work and submit via Submit Assignments.
All work MUST be shown on the appropriate worksheet; Link each appropriate box to
Remember that your full work must be contained on the appropriate work
The editor of a textbook publishing company is trying to decided whether to publish a proposed business statis
Information on previous textbooks indicates that 10% are huge success, 20% are modest success, 40
even, and 30% are losers.
However, before a publishing decision is made, the book will be reviewed.
In the p
the huge successes received favorable reviews, 70% of the moderate successes recevied favorable reviews, 40%
break even books received favorable reviews, and 20% of the losers received favorable reviews.
If the proposed text receives a favorable review, how should the editor revise the
probabilities of the various outcomes to take this information into account?
A municipal bond service has three rating categories (A,B, and C).
Suppose that in the past year, of the munic
issued throughout the United States, 70% were rated A, 20% were raterd B and 10% were rated C.
Of the mun
bonds rated A, 50% were issued by cities, 40% by suburbs, and 10% by rural areas.
Of the municipal bonds ra
were issued by cities, 20% by suburbs, and 20% by rural areas.
Of the municipal bonds rated C, 90% were iss
cities, 5% by suburbs, and 5% by rural areas.
a. If a new municipal bond is to be issued by a city, what is the probability that it will
receive an A rating?