A Local FedEx/Kinkos Has Three Black-And-White Copy Machines and Two

question 107

Multiple Choice

A local FedEx/Kinkos has three black-and-white copy machines and two color copiers. Based on historical data, the chances that each black-and-white copier will be down for repairs is 0.10. The color copiers are more of a problem and are down 20% of the time each. If a customer wants both a color copy and a black-and-white copy, what is the probability that the necessary machines will be available? (Assume that the color copier can also be used to make a black- and-white copy if needed.)

• A) 0.04
• B) 0.96
• C) 0.47
• D) 0.42

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Definitions:

Duration

A measure of the sensitivity of the price of a bond or other debt instrument to a change in interest rates, typically expressed in years.

Coupon

The interest rate on a bond that the issuer promises to pay to the holder until maturity.

Zero-Coupon Bond

A bond that does not pay periodic interest and is sold at a discount from its face value, with the return being the difference between the purchase price and the bond's face value at maturity.

Duration

A measure of the sensitivity of the price of a bond or other debt instrument to a change in interest rates, often indicating the bond's price volatility.