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Unformatted text preview: te a four-state Markov chain
with states 1, 2, 3, and 4 where 3 = a part that was scrapped and 4 = a part
that was sold for a proﬁt. (b) Compute the probability a part is scrapped in
the production process.
1.56. A bank classiﬁes loans as paid in full (F), in good standing (G), in arrears
(A), or as a bad debt (B). Loans move between the categories according to the
following transition probability:
01 What fraction of loans in good standing are eventually paid in full? What is
the answr for those in arrears?
1.57. A warehouse has a capacity to hold four items. If the warehouse is neither
full nor empty, the number of items in the warehouse changes whenever a new
item is produced or an item is sold. Suppose that (no matter when we look)
the probability that the next event is “a new item is produced” is 2/3 and that
the new event is a “sale” is 1/3. If there is currently one item in the warehouse,
what is the probability that the warehouse will become full before it becomes
1.58. Six children (Dick...
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- Spring '10
- The Land