[5] A contractor estimates the probabilities for the number of days required to com- plete a certain type of construction project as follows: Time (days) 1 2 3 4 5 Probability 0.05 0.2 0.35 0.3 0.1 a) What is the probability that a randomly chosen project takes less than 3 days to complete? b) Find the expected time to complete the project. c) Find the standard deviation of the time required to complete the project. d) Suppose the contractor's project cost is made of two parts: a fixed cost of $20,000 and $2,000 for each day taken to complete the project. Find the mean and standard deviation of the total project cost. e) If three projects are undertaken, what is the probability that at least two of them will take at least 4 days to complete? Assume that project completion times are independent.

[5] A contractor estimates the probabilities for the number of days required to com- plete a certain type of construction project as follows: Time (days) 1 2 3 4 5 Probability 0.05 0.2 0.35 0.3 0.1 a) What is the probability that a randomly chosen project takes less than 3 days to complete? b) Find the expected time to complete the project. c) Find the standard deviation of the time required to complete the project. d) Suppose the contractor's project cost is made of two parts: a fixed cost of $20,000 and $2,000 for each day taken to complete the project. Find the mean and standard deviation of the total project cost. e) If three projects are undertaken, what is the probability that at least two of them will take at least 4 days to complete? Assume that project completion times are independent.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter17: Making Decisions With Uncertainty

Section: Chapter Questions

Problem 17.1IP

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