1.

Many companies use a quality control technique called acceptance sampling to monitor
incoming shipments of parts, raw materials, and so on. In the electronics industry,
component parts are commonly shipped from suppliers in large lots. Inspection of a
sample of n components can be viewed as the n trials of a binomial experiment. The
outcome for each component tested (trial) will be that the component is classified as good
or defective. Reynolds Electronics accepts a lot from a particular supplier if the
defective components in the lot do not exceed 1%. Suppose a random sample of five
items from a recent shipment is tested.

a. Assume that 1% of the shipment is defective. Compute the probability that no items
in the sample are defective.
b. Assume that 1% of the shipment is defective. Compute the probability that exactly one
item in the sample is defective.
c. What is the probability of observing one or more defective items in the sample if 1%
of the shipment is defective?
d. Would you feel comfortable accepting the shipment if one item was found to be defective?
Why or why not?
2. Through the week ending September 16, 2001, Tiger Woods was the leading money
winner on the PGA Tour, with total earnings of $5,517,777. Of the top 10 money
winners, seven players used a Titleist brand golf ball (PGA Tour website). Suppose that
we randomly select two of the top 10 money winners.
a. What is the probability that exactly one uses a Titleist golf ball?
b. What is the probability that both use Titleist golf balls?
c. What is the probability that neither uses a Titleist golf ball?

3. Anew automated production process averages 1.5 breakdowns per day. Because of the
cost associated with a breakdown, management is concerned about the possibility of
having three or more breakdowns during a day. Assume that breakdowns occur
randomly, that the probability of a breakdown is the same for any two time intervals of
equal length, and that breakdowns in one period are independent of breakdowns in other
periods. What is the probability of having three or more breakdowns during a day?

4. According to the Sleep Foundation, the average night’s sleep is 6.8 hours (Fortune,
March 20, 2006). Assume the standard deviation is .6 hours and that the probability
distribution is normal.
a. What is the probability that a randomly selected person sleeps more than 8 hours?
b. What is the probability that a randomly selected person sleeps 6 hours or less?
c. Doctors suggest getting between 7 and 9 hours of sleep each night. What percentage
of the population gets this much sleep? nor
5. A machine fills containers with a particular product. The standard deviation of filling
weights is known from past data to be .6 ounce. If only 2% of the containers hold less than
18 ounces, what is the mean filling weight for the machine? That is, what must μ equal?
Assume the filling weights have a normal distribution. nor
 6. A Myrtle Beach resort hotel has 120 rooms. In the spring months, hotel room occupancy
is approximately 75%.
a. What is the probability that at least half of the rooms are occupied on a given day?
b. What is the probability that 100 or more rooms are occupied on a given day?
c. What is the probability that 80 or fewer rooms are occupied on a given day?

7. Many drugs used to treat cancer are expensive. BusinessWeek reported on the cost per
treatment of Herceptin, a drug used to treat breast cancer (BusinessWeek, January 30,
2006). Typical treatment costs (in dollars) for Herceptin are provided by a simple random
sample of 10 patients.
4376 5578 2717 4920 4495
4798 6446 4119 4237 3814
a. Develop a point estimate of the mean cost per treatment with Herceptin.
b. Develop a point estimate of the standard deviation of the cost per treatment with
Herceptin.
8. Consumption of alcoholic beverages by young women of drinking age has been
increasing in the United Kingdom, the United States, and Europe (The Wall Street
Journal, February 15, 2006). Data (annual consumption in liters) consistent with the
findings reported in The Wall Street Journal article are shown for a sample of 20
European young women.
266 82 199 174 97
170 222 115 130 169
164 102 113 171 0
93 0 93 110 130
Assuming the population is roughly symmetric, construct a 95% confidence interval for
the mean annual consumption of alcoholic beverages by European young women.
9. A production line operates with a mean filling weight of 16 ounces per container.
Overfilling or under filling presents a serious problem and when detected requires the
operator to shut down the production line to readjust the filling mechanism. From past
data, a population standard deviation σ = .8 ounces is assumed. A quality control
inspector selects a sample of 30 items every hour and at that time makes the decision of
whether to shut down the line for readjustment. The level of significance is α _ .05.
a. State the hypothesis test for this quality control application.
b. If a sample mean of 16.32 ounces were found, what is the p-value? What action
would you recommend?
c. If a sample mean of 15.82 ounces were found, what is the p-value? What action
would you recommend?
d. Use the critical value approach. What is the rejection rule for the preceding hypothesis
testing procedure? Repeat parts (b) and (c). Do you reach the same conclusion?
 10. An airline promotion to business travelers is based on the assumption that two-thirds of
business travelers use a laptop computer on overnight business trips.
a. State the hypotheses that can be used to test the assumption.
b. What is the sample proportion from an American Express sponsored survey that found
355 of 546 business travelers use a laptop computer on overnight business trips?
c. What is the p-value?
d. Use α _ .05. What is your conclusion?