You are here:

Advanced Math/Quantitative analysis for managerial applications

Advertisement

Expert: - 10/9/2011


Question
Hello sir
i need answer for the following questions

1. A bank has a test designed to establish the credit rating of a loan applicant. Of the persons, who default (D), 90% fail the test (F). Of the persons, who will repay the bank (ND), 5% fail the test. Furthermore, it is given that 4% of the population is not worthy of credit; i.e., P(D) = .04. Given that someone failed the test, what is the probability that he actually will default (When given a loan)?

2.   Strength tests carried out on samples of two yarns spun to the same count gave the following results:
  Number in
sample   Sample
Mean   Sample
variance
Yarn A   4   50   42
Yarn B   9   42   56

The strengths are expressed in pounds. Does the difference in mean strengths indicate a real difference in the mean strengths of the yarn?

Answer
1. Pass     0.95  0.05
  No Pass  0.10  0.90
  
Let the chance of passing be P and the changce of not passing is 1-P.
This means that 0.05P + 0.90(1-P) = 0.04.
That works out to be 0.05P + 0.90 - 0.90P = 0.04.
Combining the P's and subtracting 0.90 from both sides gives -0.85P = -0.86.

This means that P = 85/86 of the people will pass, so 1/86 of the people will fail.


2. The strengths are expressed in pounds. Does the difference in mean strengths indicate a real difference in the mean strengths of the yarn?

The t test gives us the value of
t = (A1 - A2)/[S12*root(1/N1 + 1/N2)
A1 = average of set 1
A2 = average of set 2
S12 = sqrt[((n1-1)S1^2 + (n2-1)S2^2)/(n1+n2-2)]
n1 = number in sample 1
n2 = number in sample 2

n1 = 4; A1 = 4*50 = 200; n2 = 9; A2 = 9*42

Advanced Math

All Answers

Answers by Expert:

Ask Experts

Volunteer

Scott A Wilson

Expertise

I can answer any question in general math, arithetic, discret math, algebra, box problems, geometry, filling a tank with water, trigonometry, pre-calculus, linear algebra, complex mathematics, probability, statistics, and most of anything else that relates to math. I can even tell you it takes me over 2,000 steps to go a mile, but is that relevant?

Experience

Experience in the area; I have tutored people in the above areas of mathematics for almost two years in AllExperts.com. I have tutored people here and there in mathematics since before I received a BS degree almost 25 years ago. In just two more years, I received an MS degree as well, but more on that later. I tutored at OSU in the math center for all six years I was there. Most students offering assistance were juniors, seniors, or graduate students. I was allowed to tutor as a freshman. I tutored at Mathnasium for well over a year. I worked at The Boeing Company for over 5 years. I received an MS degreee in Mathematics from Oregon State Univeristy. The classes I took were over 100 hours of upper division credits in mathematical courses such as calculus, statistics, probabilty, linear algrebra, powers, linear regression, matrices, and more. I graduated with honors in both my BS and MS degrees. Past/Present Clients: College Students at Oregon State University, various math people since college, over 7,500 people on the PC from the US and rest the world.

Publications
My master's paper was published in the OSU journal. The subject of it was Numerical Analysis used in shock waves and rarefaction fans. It dealt with discontinuities that arose over time. They were solved using the Leap Frog method. That method was used and improvements of it were shown. The improvements were by Enquist-Osher, Godunov, and Lax-Wendroff.

Education/Credentials
Master of Science at OSU with high honors in mathematics. Bachelor of Science at OSU with high honors in mathematical sciences. This degree involved mathematics, statistics, and computer science. I also took sophmore level physics and chemistry while I was attending college. On the side I took raquetball, but that's still not relevant.

Awards and Honors
I earned high honors in both my BS degree and MS degree from Oregon State. I was in near the top in most of my classes. In several classes in mathematics, I was first. In a class of over 100 students, I was always one of the first ones to complete the test. I graduated with well over 50 credits in upper division mathematics.

Past/Present Clients
My clients have been students at OSU, people nearby, friends with math questions, and several people every day on the PC, and you're probably make one more.

©2012 About.com, a part of The New York Times Company. All rights reserved.