Question

1.

A recent survey reported in BusinessWeek dealt with the salaries of CEOs at large corporations and whether company shareholders made money or lost money.

	CEO Paid More Than $1 Million	CEO Paid Less Than $1 Million	Total
Shareholders made money	6	15	21
Shareholders lost money	8	4	12
Total	14	19	33

If a company is randomly selected from the list of 33 studied, calculate the probabilities for the following :

(a)	The CEO made more than $1 million. (Round your answers to 3 decimal places.)

Probability

(b)	The CEO made more than $1 million or the shareholders lost money. (Round your answers to 3 decimal places.)

Probability

(c)	The CEO made more than $1 million given the shareholders lost money. (Round your answers to 3 decimal places.)

Probability

(d)	Select 2 CEOs and find that they both made more than $1 million. (Round your answers to 3 decimal places.)

Probability

2.

The probability a HP network server is down is .062. If you have four independent servers, what is the probability that at least one of them is operational? (Round your answer to 6 decimal places.)

Probability

Answer 1

1.

(a)

P( The CEO made more than $1 million ) = 14/33 = 0.424

So,

Answer is:

Probability

0.424

(b)
P( The CEO made more than $1 million or the shareholders lost money) = P( The CEO made more than $1 million) + P( the shareholders lost money) - P( The CEO made more than $1 million AND the shareholders lost money.)

= 14/33 + 12/33 - 8/33

= 18/33

= 0.545

Answer is:

Probability

0.545

(c)

P( The CEO made more than $1 million / the shareholders lost money) = P( The CEO made more than $1 million AND the shareholders lost money)/ P(the shareholders lost money)

= 8/12

= 0.667

Answer is:

Probability

0.667

(d)

P( Select 2 CEOs and find that they both made more than $1 million. ) = 0.424² = 0.180

Answer is:

Probability

0.180

2.

P( at least one of them is operational ) = 1 - P(All 4 servers are not operational)

= 1 - 0.062⁴

= 1 - 0.00001478

= 0.999985

Answer is:

Probability

0.999985