An oil exploration firm is formed with enough capital to finance ten explorations. The probabil- ity of a particular exploration being successful is .1. Assume the explorations are independent. Find the mean and variance of the number of successful explorations.
Accepted Solution
A:
Answer:μ = 1 The firm expects that one oil exploration will be successful.v(x)= 0.9 Step-by-step explanation:The first step is to define the random variable x as:x: number of oil explorations being succesful Then x can be take this values:x = 0 , x =1 ... x =10 x is a binomially distributed random variable with parameters.p = 0.1 and n=10 And the mean or the expected value of x is:μ = E(x) = npThen μ = 10*0.1 = 1 And the variance of x is:V(x) = np(1-p)V(x) = 10(0.1)(1-0.1)= 0.9