Page 246 - BA2 Integrated Workbook - Student 2017
P. 246
Fundamentals of Management Accounting
CHAPTER 12 – RISK 2: PROBABILITY
12.1 There are different types of probabilities.
Use some of the following words to complete the sentences below.
Expected Exact Subjective
Historical Objective Empirical
__________ probabilities can be calculated from samples of past observations.
__________ probabilities are based on judgement.
__________ probabilities can be applied to the population of outcomes for a
certain event.
12.2 The finance department of a pharmaceutical company is concerned that the
ageing machinery on its production line is causing losses by putting too much on
average of a certain product into each container. A check on the line shows that
the mean amount being put into a container is 499.5 ml, with a standard
deviation of 0.8 ml.
Adopting a normal distribution, what percentage of containers will contain
more than the notional contents of 500 ml?
12.3 PQR is considering launching a new product. Initial estimates have suggested
that the profit from the new product could be $50,000, $22,000 or a loss of
$10,000 depending on market conditions.
It is estimated that the probability of the best and worst outcomes are both 20%.
Calculate the expected profit.
12.4 A company is analysing its finance staff by location and qualification.
The 111 finance employees can be classified by their work location (A, B or C)
and by their professional qualifications (qualified or not qualified).
79 of the finance staff are qualified. Of the 37 who work in location A 26 are
qualified. Location C employs 36 finance staff 24 of which are qualified.
What is the probability that a randomly selected unqualified employee will
work in location A or B?
238
