There Are Three Approaches to Determining the Probability That an Outcome

question 116

Essay

There are three approaches to determining the probability that an outcome will occur: classical,relative frequency,and subjective.For each situation that follows,determine which approach is most appropriate.
a.A Russian will win the French Open Tennis Tournament next year.
b.The probability of getting any single number on a balanced die is 1/6.
c.Based on the past,it's reasonable to assume the average book sales for a certain textbook is 6,500 copies per month.

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Definitions:

Marginal Cost

The additional cost incurred from producing one more unit of a good or service.

Moral Hazard

The situation where one party in an agreement is tempted to take undue risks because the negative consequences of the risk will be suffered by the other party.

Efficient Level

The optimal point of production or operation where costs are minimized and productivity or utility is maximized.

Warranty

A guarantee, usually made by a seller to a buyer, promising to repair or replace a product if necessary within a specified period.