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Researchers randomly select a married couple in which both spouses are employed. Let Xbe the income of the husband and Ybe the income of the wife. Suppose that you know the means μXandμYand the variances σX2andσY2of both variables.

a. Can we calculate the mean of the total income X+YtobeμX+μY? Explain your answer.

b. Can we calculate the variance of the total income to beσX2+σY2 ? Explain your answer.

Short Answer

Expert verified

a. Yes, we can calculate the mean of the total income asμX+μY

b. The variance of total revenue cannot be calculated asσ2X+σ2Y.

Step by step solution

01

Part(a) Step 1 : Given Information 

Given :

X: The income of the husband

Y: The income of the wife.

02

Part(a) Step 2 : Simplification   

The sum of the means of two random variables is the total of their means.

μX+Y=μX+μY

We may calculate the mean of total income X+YtobeμX+μYsince the property holds for any two random variables, and because the means for both XandYare known.

03

Part(b) Step 1 : Given Information 

Given :

X: The income of the husband

Y: The income of the wife.

04

Part(b) Step 2 : Simplification   

The variance of the total is equal to the sum of the variances of the two random variables.

However, this is only conceivable if two random variables are independent; otherwise, this is not true.

σ2X+Y=σ2X+σ2Y

People who are intelligent tend to grow even more intelligent.

Furthermore, clever people are more likely to make more money.

As a result, it is reasonable to conclude that the husband's income Xis unrelated to the wife's Yincome.

As a result, the variance of total revenue cannot be calculated asσ2X+σ2Y

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