A card is drawn from a deck. Given that it is a face card, what is the probability it is a King?
Solution:
Given face card (12 face cards), 4 are Kings. \( P(K \mid F) = \dfrac{4}{12} = \dfrac{1}{3} \).
Topic 4.3 — Discrete Probability Distributions
Question 5
A random variable \( X \) has the distribution:
\( X = 0 \): \( P = 0.2 \) \( X = 1 \): \( P = 0.3 \) \( X = 2 \): \( P = 0.4 \) \( X = 3 \): \( P = 0.1 \) Verify it is valid by checking the sum. Then find \( P(X \ge 2) \).
A game costs $5 to play. You roll a single die. If you roll a 6, you win $20. Otherwise, you win nothing. Find the expected NET value (winnings minus cost) per play.
Solution:
\( E(\text{net}) = \dfrac{1}{6}(20 - 5) + \dfrac{5}{6}(0 - 5) = \dfrac{15}{6} - \dfrac{25}{6} = -\dfrac{10}{6} \approx -\$1.67 \). The game is unfair (loses money on average).
Question 7
A random variable \( X \) takes values 1, 2, 3 with probabilities 0.2, 0.5, 0.3. Find \( E(X) \).
An insurance company pays $10 000 if a customer dies during the year. The probability of death is 0.001. To make the policy fair (zero expected profit), what should the premium be?
Solution:
Expected payout = \( 0.001 \times 10\,000 = \$10 \). Fair premium = $10. (Real premiums are higher to cover overhead and profit.)
Question 12
In a 30-question MC test (4 choices each), a student guesses on every question. The expected number correct is: