document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=468149>Question 468149</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Can someone please show me how to preform these two problems? I am completely lost. <BR>\n" );
document.write( "9. A two year extended warranty on a computer costs $40. Suppose during these two years the<BR>\n" );
document.write( "probability that the computer will need a minor repair is 0.05, and a major repair 0.01. Further<BR>\n" );
document.write( "suppose a minor repair costs $200 and a major repair $500. What is the warranty issuer’s expected<BR>\n" );
document.write( "profit from selling the policy?<BR>\n" );
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document.write( "10. Suppose the expected life of a certain type of fruit fly is 100 hours with a standard deviation<BR>\n" );
document.write( "of 15 hours. According to the Chebychev’s inequality, the<BR>\n" );
document.write( "probability that a randomly selected fruit fly will live between 70 and 130 hours is at least _______. </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #321216 by </B><A HREF=/tutors/aboutme.mpl?userid=ccs2011><B>ccs2011(207)</B></A><img src=\"/images/stars/stars-09.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=ccs2011><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=ccs2011><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=321216\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> *******************************<BR>\n" );
document.write( "9)Find the expected value of the warranty<BR>\n" );
document.write( "The expected value is like a weighted average of all the possible outcomes<BR>\n" );
document.write( "the company will take in 40 with probability of 1<BR>\n" );
document.write( "the company will have to pay out 200 with probability of .05<BR>\n" );
document.write( "the company will have to pay out 500 with probability of .01<BR>\n" );
document.write( "E = 40 - 200(.05) -500(.01)<BR>\n" );
document.write( "E = 40 - 10 - 5<BR>\n" );
document.write( "E = 25<BR>\n" );
document.write( "Therefore for each warranty sold the company can expect a profit of $25.\r<BR>\n" );
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document.write( "10)Chebychev’s inequality:<BR>\n" );
document.write( "P(|X-u|>k*s) < 1/k^2<BR>\n" );
document.write( "u = mean<BR>\n" );
document.write( "s = standard deviation<BR>\n" );
document.write( "k>0<BR>\n" );
document.write( "In this case u is 100, s is 15.<BR>\n" );
document.write( "|130-100| = |70-100| = 30<BR>\n" );
document.write( "30 = 2*15, therefore exactly 2 deviations away<BR>\n" );
document.write( "k = 2<BR>\n" );
document.write( "P(|X-100|>30) < 1/4<BR>\n" );
document.write( "1 - 1/4 = 3/4<BR>\n" );
document.write( "Therefore<BR>\n" );
document.write( "P(|X-100|<30| > 3/4<BR>\n" );
document.write( "In other words the probability that X is within 70 and 130 is greater than 3/4 </SPAN>\n" );
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