In February 2002 the Argentine peso lost 70% of its value compared to the United

Question

In February 2002 the Argentine peso lost 70% of its value compared to the United States dollar. This devaluation drastically raised the price of imported products. According to a survey conducted by AC Nielsen in April 2002, 68% of the consumers in Argentina were buying fewer products than before the devaluation, 24% were buying the same number of products, and 8% were buying more products. Furthermore, in a trend toward purchasing less-expensive brands, 88% indicated that they had changed the brands they purchased. Suppose the following complete set of results were reported. Use the following data to answer questions 9 through 12.

Number of Products Purchased
Brands Purchased Fewer Same More Total
Same 10 14 24 48
Changed 262 82 8 352
Total 272 96 32 400





13. Suppose that the probability that a new medication will cause a bad side effect is 0.03. If this medication is given to 150 people, what is the probability that exactly three of them will experience a bad side effect? Place your answer, rounded to 4 decimal places, in the blank. _______

Explanation / Answer

13 Solution: 150nCr0 (.03)^0(.97)^(150) = .0104 150nCr1 (.03)^1(.97)^(149) = .0481 150nCr2 (.03)^2(.97)^(148) = .1108 150nCr3 (.03)^3(.97)^(147) = .1691 P(0) + P(1) + P(2) + P(3) = .0104 + .0481 + .1108 + .1691 = .3384 1 - (P(0) + P(1) + P(2) + P(3)) = 1 - .3384 = .6616 = 66.16% 66.16%

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