University of Cebu

College of Business and Accountancy

Cebu City

Subject: BA 319 – Statistical Analysis with Software Application

Assignment 2

I. Please review Chapter 4 and answer the following exercises:

1. #9 on page 166.

Question: Simple random sampling uses a sample of size n from a population of size N to obtain
data that can be used to make inferences about the characteristics of a population. Suppose
that, from a population of 50 bank accounts, we want to take a random sample of four accounts
in order to learn about the population. How many different random samples of four accounts
are possible?

50 ! (50)(49)( 48)(47) 5527200

Answer: p50
4 = = = =230,300
4 ! (50−4 ) ! ( 4 ) ( 3 ) (2)(1) 24

2. #18 on page
170.

Suppose that a manager of a large apartment complex provides the following subjective probability
estimates about the number of vacancies that will exist next month.

Provide the probability of each of the following events.

a. No vacancies= P(0)= 0.05

b. At least four vacancies= P(4)+P(5)= .10+.10= .20

c. Two or fewer vacancies= P(2)+P(1)+P(0)=.35+.15+.05= .55

 University of Cebu
College of Business and Accountancy
Cebu City

3. #22 on page 176.

a. P(A)= P(E1)+P(E2)
1 1 2
= + = ∨0.4
5 5 5
P(B)= P(E3)+P(E4)
1 1 2
= + = ∨0.4
5 5 5
P(C)= P(E2)+P(E3)+P(E5)
=

1 1 1 3
+ + = ∨0.6
5 5 5 5

b. Find P(A ∪ B). Are A and B mutually exclusive?

Formula: P( A ∪ B) = P(A) +P(B)

2 2 4
Solution: = + = ∨0.8
5 5 5

A and B mutually exclusive P(A∩B)= 0

c. Find Ac , Cc , P(Ac ), and P(Cc ).
Ac= S-A
= {E1,E2E3,E4,E5} – {E1,E2)
={E3,E4,E5}
 University of Cebu
College of Business and Accountancy
Cebu City

Cc=S-C
= {E1,E2E3,E4,E5} – { E2E3,E5}
= {E1, E4}
P(Ac )= 1- P(A)
2 3
= 1- = ∨0.6
5 5

P(Cc )= 1- P(C)
3 2
= 1- = ∨0.4
5 5
d. Find A ∪ Bc and P(A ∪ Bc )
A ∪ Bc = {E1,E2,E5} ∪ {E1, E2}
= {E1, E2}
P(A ∪ B )= P(E1) + P(E2)
c

1 1 2
= + =
5 5 5
e. Find P(B ∪ C)
Formula: P(B ∪ C) = P(B) + P(C)- P(B ∩C ¿
1
P(B ∩C ¿=
5
2 3 1 4
Solution: P(B ∪ C) = + − = = ∨0.8
5 5 5 5

4. #30 on page 182.

Suppose that we have two events, A and B, with P(A) = .50, P(B) = .60, and P(A ∩ B) = .40.

.50 5
a. Find P(A|B). = = 0r .83
.60 6
p (A ∩B) .50
b. Find P(B | A)= = =1
P( A) .50
c. Are A and B independent? Explain
Not independent, I could say that events A and B are dependent events. That is, the probability of
event A is altered or affected by knowing that event B exists.

5. #40 on page 190.

The prior probabilities for events A1, A2, and A3 are P(A1) = .20, P(A2) = .50, and P(A3) = .30. The
conditional probabilities of event B given A 1, A2, and A3 are P(B | A1) =.50, P(B | A2) = .40, and P(B
|A3) = .30.
a. Compute P(B ∩ A1), P(B ∩ A2), and P(B ∩A3).
P(B ∩ A1)= 0.20 x 0.50 = .10
 University of Cebu
College of Business and Accountancy
Cebu City

P(B ∩ A2)= 0.50 x 0.40 = .20

P(B ∩A3)= 0.30 x 0.30= .09

b. Use Bayes’ theorem, equation (4.19), to compute the posterior probability P(A2 ' B).

( .50 ) (.40)
P(A2 |B)= =0.5128
0.39

c. Use the tabular approach to applying Bayes’ theorem to compute P(A1 ' B), P(A2 ' B), and P(A3
' B).

Events Prior Probabilities Conditional Joint Probabilities Posterior

Ai P(Ai) Probabilities P(Ai∩ B ¿) Probabilities
P(B| Ai)

A1 .20 .50 0.1 0.2564

A2 .50 .40 0.2 0.5128

A3 .30 .30 0.09 0.2308

P(B)= 0.39 1
 University of Cebu
College of Business and Accountancy
Cebu City