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Section I: Multiple Choice Choose the best answer for each question. A grocery chain
Chapter 7, Problem AP2.20(choose chapter or problem)
Section I: Multiple Choice Choose the best answer for each question. A grocery chain runs a prize game by giving each customer a ticket that may win a prize when the box is scratched off. Printed on the ticket is a dollar value ($500, $100, $25) or the statement This ticket is not a winner. Monetary prizes can be redeemed for groceries at the store. Here is the probability distribution of the amount won on a randomly selected ticket: Amount won: $500 $100 $25 $0 Probability: 0.01 0.05 0.20 0.74 Which of the following are the mean and standard deviation, respectively, of the winnings? (a) $15.00, $2900.00 (b) $15.00, $53.85 (c) $15.00, $26.93 (d) $156.25, $53.85 (e) $156.25, $26.93
Questions & Answers
QUESTION:
Section I: Multiple Choice Choose the best answer for each question. A grocery chain runs a prize game by giving each customer a ticket that may win a prize when the box is scratched off. Printed on the ticket is a dollar value ($500, $100, $25) or the statement This ticket is not a winner. Monetary prizes can be redeemed for groceries at the store. Here is the probability distribution of the amount won on a randomly selected ticket: Amount won: $500 $100 $25 $0 Probability: 0.01 0.05 0.20 0.74 Which of the following are the mean and standard deviation, respectively, of the winnings? (a) $15.00, $2900.00 (b) $15.00, $53.85 (c) $15.00, $26.93 (d) $156.25, $53.85 (e) $156.25, $26.93
ANSWER:Step 1 of 5
The goal of the problem is to determine the mean and standard deviation of the winnings given probability distribution.
The mean or the expected value of a discrete random variable gives us the average outcome of the experiment that is repeated multiple times. Meanwhile, the variance still pertains to the squared deviations of the observed value from the average computed.
But how do we compute for this?