IIFT 2020 Question 14

Question 14

The probabilities of three mutually exclusive outcomes of an
experiment $$0.25(1 — x), 0.5(1 — 2x)$$ and $$0.25(1 + 4x)$$ respectively.
Which of the following holds for the value of x ?

Solution

As all 3 are mutually exclusive, we can assume (in one extreme case) that these 3 form the entire range of probability and hence,
0.25(1-x) + 0.5(1-2x) + 0.25 (1+4x) = 1 which gives us x = 0 
Hence, x is bound by 0 on one end. 

Also, none of the probabilities can be negative as any event probability is atleast 0. Hence, for the second event, we can see that x cnnot be greater than 0.5
hence, x is bounded from 0 to 0.5



Create a FREE account and get:

  • All Quant Formulas and shortcuts PDF
  • 40+ previous papers with solutions PDF
  • Top 500 MBA exam Solved Questions for Free

Comments

Register with

OR
cracku

Boost your Prep!

Download App