Practice Business Mathematics I Final Exam

PART A

1. Suppose $5,000 is invested at an annual interest rate of 10%. Compute the balance after 10 years if the interest
is compounded monthly.

2. If log2 x = 5; what is ln x?
x
3. Determine when the function f (x) = xe is increasing and decreasing.
p
(x+1)3 3 2x+1
4. Use logarithmic di¤erentiation to …nd the derivative of f (x) = (6 x)2
.
R p R2
5. Calculate x2 2x + 5dx and 1 (t 1) e1 t dt
p
6. Find the area of the region bouded by the curve y = x + x, the x-axis, and the lines x = 1 and x = 4:
7. Money is deposited in a bank o¤ering interest at an annual rate of 6% compounded continuously. Find the
percentage rate of change of the balance with respect to time.
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8. Find an equation for the tangent line to the graph of y = (x + ln x) at the point where x = 1:
9. Let A; B; and C be subsets of a universal set U and suppose n(U ) = 80; n (A) = 26; n (B) = 18; n (C) =
36; n (A \ B) = 10; n (A \ C) = 11; n (B \ C) = 11 and n (A [ B [ C) = 5. Find n (Ac \ B c )and n (A \ B \ C)
.
10. The 2011 Toyota Camry comes with 5 grades of models, 2 sizes of engines, 4 choices of transmissions, 5 exterior
colors, and 2 interior colors. How many choices of the Camry are available for a prospective buyer?
11. Find the number of distinguishable permutations that can be formed from the letters of the word ANTARC-
TICA.
12. A sample of three apples taken from Cavallero’s Fruit Stand is examined to determine whether the apples are
good or rotten.What is an appropriate sample space for this experiment?
13. Let E and F be two events of an experiment with sample space S. Suppose P (E) = 0:6; P (F ) = 0:4; and
P (E \ F ) = 0:2. Compute P (E c ) ; P (E [ F ) ; and P (E c \ F ) :
14. A die is rolled repeatedly until a 6 falls uppermost. Let the random variable X denote the number of times the
die is rolled. What are the values that X may assume?
15. A principal of $2000 is invested at 10% interest compounded continuously. After how many days will the
investment …rst exceed $2100?
16. Suppose q hundred units of a certain commodity are demanded by consumers when the price is p = 25 q 2
dollars per unit. What is the consumers’surplus for the commodity when the level of production is q0 = 4 (400
units)?
17. Money is transferred into an account at the rate of R(t) = 3; 000 + 5t dollars per year for 10 years, where t is
the number of years after 2016. If the account pays 5% interest compounded continuously, how much will be
in the account at the end of the 10-year investment period (in 2026)?

PART B

1. A student taking an examination is required to answer exactly 10 out of 15 questions.

(a) In how many ways can the 10 questions be selected?

(b) In how many ways can the 10 questions be selected if exactly 2 of the …rst 3 questions must be answered?

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2. A student studying for a vocabulary test knows the meanings of 12 words from a list of 20 words. If the test
contains 10 words from the study list, what is the probability that at least 8 of the words on the test are words
that the student knows?
3. A coin is tossed four times. Let the random variable X denote the number of tails that occur.

(a) List the outcomes of the experiment.

(b) Find the value assigned to each outcome of the experiment by the random variable X.
(c) Find the event consisting of the outcomes to which a value of 2 has been assigned by X.

4. The estimated probability that a Brand A, a Brand B, and a Brand C plasma TV will last at least 30,000 hr
is .90, .85, and .80, respectively. Of the 4500 plasma TVs that Ace TV sold in a certain year, 1000 were Brand
A, 1500 were Brand B, and 2000 were Brand C. If a plasma TV set sold by Ace TV that year is selected at
random and is still working after 30,000 hr of use:

(a) What is the probability that it was a Brand A TV?

(b) What is the probability that it was not a Brand A TV?
(c) Use a tree diagram to exhibit all possible outcomes.

5. A tire manufacturer estimates that q (thousand) radial tires will be purchased (demanded) by wholesalers when
the price is
p = D (q) 0:1q 2 + 90
dollars per tire, and the same number of tires will be supplied when the price is

p = S (q) = 0:2q 2 + q + 50

dollars per tire.

(a) Find the equilibrium price (where supply equals demand) and the quantity supplied and demanded at
that price.
(b) Determine the consumers’and producers’surplus at the equilibrium price.

6. A manufacturer of machinery parts determines that q units of a particular piece will be sold when the price is
p (q) = 110 q dollars per unit. The total cost of producing those q units is C (q) dollars, where

C (q) = q 3 25q 2 + 2q + 3000

(a) How much pro…t is derived from the sale of the q units at p dollars per unit? [Hint: First …nd the revenue
R = pq; then pro…t=revenue-cost.]
(b) For what value of q is pro…t maximized?
(c) Find the consumers’surplus for the level of production q0 that corresponds to maximum pro…t.

7. The probability distribution of the random variable X is shown in the accompanying table

x 10 5 0 5 10 15 20
P (X = x) 0:20 0:15 0:05 0:25 0:10 0:15 0:15

Find

(a) P (X 5) ; P ( 5 < X 15) ; and P (X = 2) :

(b) The expected value and the variance of X:

8. A wealthy patron of a small private college wishes to endow a chair in mathematics with a gift of G thousand
dollars. Suppose the mathematician who occupies the chair is to receive $70,000 per year in salary and bene…ts.
If money costs 8% per year compounded continuously, what is the smallest possible value for G?