Statistics Problem Set on Probability August 2025
1. State with justifications whether the statement is true or false
(i) I tossed a coin 10 times and obtained four heads. Hence the probability
of getting a head with that coin is 4/10.
(ii) Mithali Raj won the toss in the first four tests in a five-test series of cricket
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match. So, she will also win the toss in the 5 test.
(iii) The probability that a student will not do well in the examination is always
less than ½.
2. The number of spots turning up when a 6-sided die is tossed.
A: The number observed is {3, 4, 5}
B: The number observed is at least 4
C: The number turns up is 2.
Find P(A), P(Ac) and P(A and B), P(A or B). Are B and C mutually exclusive?
3. Given P(A) = 0.5, P(A∪B) = 0.6. Find P(B) if
(i) A and B are mutually exclusive
(ii) A and B are independent
(iii) P(A/B) = 0.4
4. Prove or disprove the following:
(i) If P(A) =0 then A=∅.
(ii) If P(A)=P(Bc) then Ac = B.
(iii) If P(A)=0 then P(A∩B) =0.
5. An assembler has been supplied with 10 electronic components out which 3 are
defective. If two components are selected at random what is the probability that neither
component is defective?
6. Suppose an agricultural researcher is studying the quality of seeds. They have a
sample of 15 seed packets, out of which 4 are defective (e.g., containing seeds that do not
germinate properly). If the researcher selects 3 seed packets at random, what is the
probability that none of the selected packets are defective?
7. A lady has invested in four stocks worth Rs. 4 lakhs and must sell two to help
finance her daughter’s studies. She decides to sell two of them randomly as she feels that
the probability of each stock appreciating after a year is equally likely. Suppose a year
later two of the original 4 stocks have increased value and two have decreased.
(i) Find the probability that both stocks retained by the lady have increased value.
(ii) Find the probability that at least one of the items retained by the lady
has increased value.
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8. In order to promote its insurance product, the company India Insure came up with
terms of 15, 20 and 25 years for paying the premium. The customers could choose
between life insurance for oneself (S) or life insurance for oneself and the spouse (D).
(a) Let A= {S15, S20, S25} and B = {S20, D20}. Describe the events in words.
Suppose 300 applications are processed and the details of the preferences by the
insurer are as below”
Term of Insurance
Type of Insurance 15 (years)
20 25
Single (S) 32 36 60
Double (D) 80 48 44
(b) The manager draws an application randomly from this set.
(i) Find the probability that the applicant has chosen option D.
(ii) Find the probability that the term of the insurance premium is more than 15 years.
9. A survey of students studying for an MBA at a particular university determined
that 96% expect a starting salary in excess of Rs. 5 lakhs per annum while 92% expect a
starting salary of less than Rs. 8 lakhs per annum. If one of these students is selected at
random, what is the probability that the student expects a salary between Rs. 5 lakhs
and Rs. 8 lakhs per annum?
10. A farmer has planted four different types of crops i.e. Sorghum, Bajra, Cotton,
and Turmeric in his field, each with a different expected yield. After one growing season,
the farmer needs to decide which two crops to harvest early to sell at the market, in
order to use the proceeds for purchasing additional farming equipment. At the end of the
season, it is observed that two of the crops have yielded high returns, and the other two
have yielded low returns.
(i) Find the probability that both crops retained by the farmer (i.e., the two
crops not harvested early) have yielded high returns.
(ii) Find the probability that at least one of the crops retained by the farmer has
yielded high returns.
11. Solve the classical problem in probability. (a) Compare the probability of a total of
9 with a total of 10 when three fair dice are tossed once (Galileo and Duke of Tuscany).
12. Consider the experiment of tossing two coins and the events are equally likely.
(i) What is the probability of getting two heads given a head on the first coin?
(ii) What is the probability of getting two heads given at least one head?
13. It is known that Reliance Industries influences the BSE index to a large extent. It is
given that
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(a) BSE index increases with probability 0.4 when the share price of Reliance increases,
(b) BSE index increases with probability 0.2 when the share price of Reliance is stationary,
(c) BSE index increases with probability 0.1 when the share price of Reliance decreases.
If the chance of Reliance shares prices increasing/ remaining stationary/decreasing are
respectively, 0.3, 0.5, 0.2, calculate
(i) Probability that BSE index increases.
(ii) Given that the BSE index has increased, what is the probability the prices of
Reliance shares have increased / remained stationary / decreased?
11. Given that the Reliance shares prices has increased on a particular day what is the
probability BSE index has increased?
12. The following table lists the joint probabilities associated with smoking and lung
cancer among 60–65-year-old men.
Smoker (A) Non-Smoker
Has lung cancer (B) 0.10 (A c)
0.03
Does not have lung cancer (Bc) 0.21 0.66
A 60–65-year-old man is selected at random. What is the probability of the following events:
(i) He is a smoker;
(ii) He does not have lung cancer;
(iii) He has lung cancer given that he is a smoker;
(iv) He has lung cancer given that he does not smoke.
13. Many Western authors have written research articles that help in predicting
bankruptcy of firms. In one such paper, the model correctly predicted the bankruptcy of 85%
of firms that in fact did fail to perform and it correctly predicted non-bankruptcy for 82%
of firms that in fact did not fail. Suppose that the model maintains the same reliability
when applied to a developing country and the study is now conducted for 100 firms in
India, of which four fails in a year following the time at which the model makes predictions.
(i) Determine the number of firms for which the model’s prediction will prove to
be correct.
(ii) Find the probability that one of these firms will go bankrupt given that the model
has predicted it will do so.
14. Each morning, coffee is prepared for the entire office staff by one of three employees,
depending on who is first to arrive at work. Veronica arrives first 20% of the time; Gita and
Michael are each the first to arrive on half of the remaining mornings. The probability that the
coffee will be bitter when it is prepared by Veronica is 0.1, while the corresponding
probabilities when it is prepared by Gita and by Michael are 0.2 and 0.3 respectively.
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(i) Draw the probability tree for this problem.
(ii) If you arrive one morning and find the coffee bitter, what is the probability that it
was prepared by Veronica?
(iii) What is the probability that the coffee will not be bitter on any given morning?
15. Government auditors routinely check tax returns to determine whether calculation
errors were made. They also attempt to detect fraudulent returns. There are several methods
that dishonest taxpayers use to evade income tax. One method is not to declare various sources
of income. Auditors have several detection methods, including spending patterns. Another
form of tax fraud is to invent deductions that are not real. After analyzing the returns of
thousands of self-employed taxpayers, an auditor has determined that 45% of fraudulent returns
contain two suspicious deductions, 28% contain one suspicious deduction, and the rest no
suspicious deductions. Among honest returns the rates are 11% for two deductions, 18% for
one deduction, and 71% for no deductions. The auditor believes that 5% of the returns of self-
employed individuals contain significant fraud. The auditor has just received a tax return for a
self-employed individual that contains one suspicious expense deduction. What is the
probability that this tax return contains significant fraud?
16. There are M students in a class numbered 1,2,…M. K students have Economics
background and the remaining (M-K) are from non-economics background. What is the
probability that in a sample of n students exactly k are from Economics background in the
following two situations?
(i) When the sample is drawn with replacement;
(ii) When the sample is drawn without replacement
Questions from MGB: 9-14 /pg.57 as mentioned in the References excel sheet
Questions from M&M: 8, 10, 12, 15, 16 (pg36); 72/73 (pg55); 76/77/82 (pg56); 87/94(pg57);
103/108(pg58)
Additionally all examples that are mentioned in the (a) handouts of the lecture notes, (b) reading
assignment in the references excel sheet and (c) other examples and problems from both the
textbooks on these topics that interests you.