Consider a company that has two different divisions. The annual profits from the two divisions are...

Consider a company that has two different divisions. The annual profits from the two divisions are independent and have distributions Profit1 ~ N (5, 32) and Profit2 ~ N (7, 42) respectively. Both the profits are in $ Million. Answer the following questions about the total profit of the company in Rupees. Assume that $1 = Rs. 45

A. Specify a Rupee range (centered on the mean) such that it contains 95% probability for the annual profit of the company.

B. Specify the 5th percentile of profit (in Rupees) for the company

C. Which of the two divisions has a larger probability of making a loss in a given year?

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Expert Solution

orchestra answered 1 year ago

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