A stock analyst was provided with a list of 25 stocks. He was expected to pick 3 stocks from the list whose prices are expected to rise by more than 20 after 30 days. In reality, the prices of only 5 stocks would rise by more than 20 after 30 days. If he randomly selected 3 stocks from the list, he would use what type of probability distribution to compute the probability that all of the chosen stocks would appreciate more than 20 after 30 days?
A) Poisson distribution. B) hypergeometric distribution.
C) binomial distribution. D) none of the above.
Question 2
What type of probability distribution will most likely be used to analyze the number of cars with defective radios in the following problem?
From an inventory of 48 new cars being shipped to local dealerships, corporate reports indicate that 12 have defective radios installed. The sales manager of one dealership wants to predict the probability out of the 8 new cars it just received that, when each is tested, no more than 2 of the cars have defective radios.
A) binomial distribution. B) hypergeometric distribution.
C) Poisson distribution. D) none of the above.
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