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The time (in years) after reaching age 60that it takes an individual to retire is approximately exponentially distributed with a mean of about five years. Suppose we randomly pick one retired individual. We are interested in the time after age

60to retirement.

a. Define the random variable.X=_________________________________.

b. Is Xcontinuous or discrete?

c.X~=________

d.=________

e.=________

f. Draw a graph of the probability distribution. Label the axes.

g. Find the probability that the person retired after age 70.

h. Do more people retire before age 65or after age 65?

i. In a room of 1,000people over age 80, how many do you expect will NOT have retired yet?

Short Answer

Expert verified

a. X=the time (in years) after reaching age 60 that it takes an individual to retire

b. Xis continuous.

c. X~Exp15

d. five

e. five

f. Check student鈥檚 solution.

g.0.1353

h. before

i.18.3

Step by step solution

01

introduction

The time (in years) after reaching age 60that it takes an individual to retire is approximately exponentially distributed with a mean of about five years.

02

Explanation (part a)

The definition of the random variable X is given as the time after 60years of age to retirement.

03

Explanation (part b)

The time (in years) after reaching age 60that it takes an individual to retire is approximately exponentially distributed with a mean of about five years. Therefore, Xis continuous.

04

Explanation (part c)

According to the provided information on the problem, the random variable Xis exponentially distributed and can be defined as below:

localid="1651916931002" X~Exp1X~Exp15X~Exp0.2where,m=0.2

05

Explanation (part d)

The mean can be represented as below:

=5

06

Explanation (part e)

The standard deviation is represented as follows:

==5

07

Explanation (part f)

It is given that X~Exp(0.2)so it clear that,

m=0.2
And, the general form of the probability density function of the exponential distribution is given below,

f(x)=me-mx=f(x)=(0.2)e-(0.2)x

The maximum value of f(x)which will lie on the y-axis and at x=0will be:

f(x)=(0.2)e-(0.20)=0.2

The value of f(x)for different values of x, we get

x
f(x)
-40.445108
-30.364424
-20.298365
-10.244281
00.2
10.163746
20.134064
30.109762
40.089866

From the above table, the graph of the probability distribution is given as:

08

Explanation (part g)

The probability distribution of an Exponential distribution is:

f(x)=ex;x>0

person retired after age 70years.

Then the number of years after the retirement age is70-60=10years.

The probability of (X>10)is as follows:

10exdx=ex10=e0.20100=0.1353

09

Explanation (part h)

According to the given information, the retirement age is 60years. So, the number of people retire before the age65.

10

Explanation (part i)

The probability distribution of an Exponential distribution is:

f(x)=ex;x>0

The person retired after age 80years.

Then the number of years after the retirement age is, 80-60=20years.

The probability of localid="1651510500745" X>20is as follows:

P=20exdx=ex20=e0.20200=0.0183

Total people in a room n=1000

The number of people that will not retire yet is given by,

nP=10000.0183=18.3

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