b.

Determine the probability that a randomly

selected individual is employed.
c. Find the probability that an unemployed
­person possesses an advanced degree.
d. What is the probability that a randomly
selected person did not finish high school?
6.47 Credit scorecards are used by financial institutions 6.50 The decision about where to build a new plant is
to help decide to whom loans should be granted. a major one for most companies. One of the fac-
An analysis of the records of one bank produced the tors that is often considered is the education level
following probabilities. of the location’s residents. Census information may
be useful in this regard. After analyzing a recent
Score census, a company produced the following joint
probabilities:
Loan Performance Under 400 400 or More

Fully repaid .19 .64 Education Northeast Midwest South West

Defaulted .13 .04 Not a high
school graduate .021 .022 .053 .032
a. What proportion of loans are fully repaid? High school
b. What proportion of loans given to scorers graduate .062 .075 .118 .058
of less than 400 fully repay? Some college,
c. What proportion of loans given to scorers of no degree .024 .038 .062 .044
400 or more fully repay? Associate’s degree .015 .022 .032 .022
d. Are score and whether the loan is fully repaid Bachelor’s degree .038 .040 .067 .050
independent? Explain. Advanced degree .024 .021 .036 .025
6.48 A retail outlet wanted to know whether its weekly Source: Statistical Abstract of the United States, 2012, Table 231.
advertisement in the daily newspaper works. To
acquire this critical information, the store man- a. Determine the probability that a person living
ager surveyed the people who entered the store and in the West has a bachelor’s degree.
determined whether each individual saw the ad and b. Find the probability that a high school graduate
whether a purchase was made. From the informa- lives in the Northeast.
tion developed, the manager produced the ­following c. What is the probability that a person selected at
table of joint probabilities. Are the ads effective? random lives in the South?
Explain. d. What is the probability that a person selected at
random does not live in the South?
Purchase No Purchase
6.51 A Gallup survey asked a sample of Americans how
See ad .18 .42 much confidence they had in the criminal justice
Do not see ad .12 .28 system. After recording the responses as well as the
race of the respondent, the following table of joint
6.49 To gauge the relationship between education and
probabilities was created.
unemployment, an economist turned to the U.S.
Census from which the following table of joint
Confidence in Justice
probabilities was produced: System White Black

Education Employed Unemployed A great deal or quite a lot .240 .041

Some .356 .048
Not a high school graduate .075 .015
Very little or none .255 .060
High school graduate .257 .035
Some college, no degree .155 .016 a. Calculate the probability that a white person
Associate’s degree .096 .008 had some confidence in the justice system.
b. Find the probability that a black person would
Bachelor’s degree .211 .012
have very little or no confidence in the justice
Advanced degree .118 .004 system
Source: Statistical Abstract of the United States, 2012, Table 221. c. What is the probability that a person who has
some confidence is white?
a. What is the probability that a high school
graduate is unemployed?
 Exercises
6.59 Given the following probabilities, compute all joint d. Find the probability of no right-handers, one
probabilities. right-hander, two right-handers, and three
right-handers.
P(A) = .9 P(AC ) = .1
P(B 0 A) = .4 P(B 0 AC ) = .7 6.66 Suppose there are 100 students in your accounting
class, 10 of whom are left-handed. Two students are
6.60 Determine all joint probabilities from the following. selected at random.
a. Draw a probability tree and insert the prob-
P(A) = .8 P(AC ) = .2
abilities for each branch.
P(B 0 A) = .4 P(B 0 AC ) = .7
What is the probability of the following events?
6.61 Draw a probability tree to compute the joint prob- b. Both are right-handed.
abilities from the following probabilities. c. Both are left-handed.
P(A) = .5 P(AC ) = .5 d. One is right-handed and the other is left-handed.
e. At least one is right-handed
P(B 0 A) = .4 P(B 0 AC ) = .7
6.67 Refer to Exercise 6.66. Suppose that three people
6.62 Given the following probabilities, draw a tree to are selected at random.
compute the joint probabilities.
a. Draw a probability tree and insert the
P(A ) = .8 P(AC ) = .2 ­probabilities of each branch.
P(B 0 A ) = .3 P(B 0 AC ) = .3 b. What is the probability of no right-handers,
one right-hander, two right-handers, and three
6.63 Given the following probabilities, find the joint right-handers?
probability P(A and B) .
6.68 An aerospace company has submitted bids on two
P(A) = .7 P(B 0 A) = .3 separate federal government defense contracts. The
company president believes that there is a 40% prob-
6.64 Approximately 10% of people are left-handed. If
ability of winning the first contract. If they win the
two people are selected at random, what is the prob-
first contract, the probability of winning the second
ability of the following events?
is 70%. However, if they lose the first contract, the
a. Both are right-handed.
president thinks that the probability of winning the
b. Both are left-handed.
second contract decreases to 50%.
c. One is right-handed and the other is left-handed.
a. What is the probability that they win both
d. At least one is right-handed.
contracts?
6.65 Refer to Exercise 6.64. Suppose that three people
b. What is the probability that they lose both
are selected at random.
contracts?
a. Draw a probability tree to depict the experiment.
b. If we use the notation RRR to describe the c. What is the probability that they win only one
selection of three right-handed people, what contract?
are the descriptions of the remaining seven 6.69 A telemarketer calls people and tries to sell them
events? (Use L for left-hander.) a subscription to a daily newspaper. On 20% of
c. How many of the events yield no right-handers, her calls, there is no answer or the line is busy. She
one right-hander, two right-handers, and three sells subscriptions to 5% of the remaining calls. For
right-handers? what proportion of calls does she make a sale?