Ch 1 Prob 2
The Retread Tire Company recaps tires. The fixed annual cost
of the recapping operation is $60,000. The variable cost of recapping a tire is
$9. The company charges $25 to recap a tire.
a. For an
annual volume of 12,000 tires, determine the total cost, total revenue, and
profit.
b.
Determine the annual break-even volume for the operation.
Ch 1 Prob 4
Evergreen Fertilizer Company produces fertilizer. The
company’s fixed monthly cost is $25,000, and its variable cost per pound of
fertilizer is $0.15. Evergreen sells the fertilizer for $0.40 per pound.
Determine the monthly break-even volume for the company.
Ch 2 Prob 10
A large research hospital has accumulated statistical data
on its patients for an extended period. Researchers have determined that
patients who are smokers have an 18% chance of contracting a serious illness
such as heart disease, cancer or emphysema, whereas there is only a 0.06
probability that a nonsmoker will contract a serious illness. From hospital
records, the researchers know that 23% of all patients are smokers, while 77%
are nonsmokers. For planning purposes, the hospital physician staff would like
to know the probability that a given patient is a smoker if the patient has a
serious illness.
Ch 2 Prob 12
The Senate consists of 100 senators, of whom 34 are
Republicans and 66 are Democrats. A bill to increase defense appropriations is
before the Senate. Thirty-five percent of the Democrats and 70% of the
Republicans favor the bill. The bill needs a simple majority to pass. Using a
probability tree, determine the probability that the bill will pass.
Ch 2 Prob 14
A metropolitan school district consists of three districts –
north, south, and central. The north district contains 25% of all students, the
south district contains 40%, and the central district 35%. A minimum competency
test was given to all students; 10% of the north district students failed, 15%
of the south district students failed, and 5% of the central district students
failed.
a. Develop
a probability tree showing all marginal, conditional and joint probabilities.
b. Develop
a joint probability table.
c. What is
the probability that a student selected at random failed the test?
