The Number of Bad Checks Received Per Day by a Store

question 75

Short Answer

The number of bad checks received per day by a store and the respective probabilities are shown below.
$\begin{array}{ll}\text { Number of Bad Checks }\\\text { Received Per Day }&\text { Probability }\\0 & 0.04 \\1 & 0.06 \\2 & 0.10 \\3 & 0.30 \\4 & 0.20 \\5 & 0.15 \\6 & 0.10 \\7 & 0.05\end{array}$
a. What is the expected number of bad checks received per day?
b. Determine the variance in the number of bad checks received per day.
c. What is the standard deviation?

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Definitions:

Latin Hypercube Sampling

A statistical method for generating a sample of plausible collections of parameter values from a multidimensional distribution.

Monte Carlo Forecasting

A technique using random sampling and statistical modeling to predict outcomes in complex systems or processes.

Monte Carlo Simulation

A computational algorithm that uses repeated random sampling to obtain numerical results, typically used to assess risk or uncertainty in prediction and forecasting models.

Crystal Ball

A forecasting and simulation software by Oracle that is used for predictive modeling, simulation, and optimization.