Reference no: EM132434129

QUESTION 1

(a) Mr Malusi is selling his business. A realtor promises that if Mr Malusi lists with her, the probability he will make $200 000 is 20%, that he will make $120 000 is 35%, that he will make $40 000 is 10%, and that he will break even is 15%. She concedes, however, that market conditions may go sour - if so, Mr Malusi has a 15% chance of losing $60 000 if he sells now - and there is even a chance he may lose $120 000. She claims, however, that there are no other possibilities. Let X be the amount of money Mr Malusi will make.

(I) What are the possible values X can take.

(II) Give the probability distribution function of X

(III)Calculate the mean value of X; that is, if she is correct and Mr Malusi lists with her, what is his expected profit

(IV) Calculate the variance of X

(V) Would you say that the distribution is symmetrical?

QUESTION 2

A owner of a business that manufactures notepads for conference venues. You also print branding details (venue name, address etc) on the notepads before delivery to the customer. You randomly select one hundred (100) orders and inspect each of the orders. Each order is considered a unit. You find the following defects:

- Two orders are only damaged (torn notepads)

- Three orders only have typos (spelling errors)

- One order is both damaged and also has typos

a. Calculate the defects per unit

Assume that the only way an order is considered defective is by being damaged or by having typos

b. How many defect opportunities are there?

c. If the process remains at this defect rate over the time it takes to produce one million orders, how many defects should you expect to find?

d. Suggest a single measure that you could take to prevent the defects described above. Base your answer on one of Deming's 14 Points