Management Science

Module 3 (Exercise 3)

Let:
P(x) = 80% or 0.80
P(x) – probability of supplies obtained by Supplier X
P(y) = 20% or 0.20
P(y) – probability of supplies obtained by Supplier Y
P(d/x) = 3% or 0.03
d – denotes % of defective supplies
P(d/y) = 1% or 0.01

The probability of defective of supplies in total is computed as follow:

P (d) = P(dx) +P(dy)
= 0.024 + 0.002
= 0.026

This value will be used to compute the probability of defective supplies from either
supplier. But before that, assuming that the supplies have been shipped, the
probabilities of the defective supplies from both suppliers are computed.
P (dx) = P(x) x P(d/x) P (dy) = P(y) x P(d/y)
= 0.80 x 0.03 = 0.20 x 0.01
= 0.024 = 0.002

Substitute these values in the following equation:

P (x/d) = P(dx) / P(d)
= 0.024 / 0.026
= 0.923
P (y/d) = P(dy) / P(d)
= 0.002 / 0.026
= 0.0769

Answer: The probability that defective parts of the shipment belong to

supplier Y is 0.0769 or 7.69%.