Suppose the Probability of a Power Outage at a Nuclear

question 86

Multiple Choice

Suppose the probability of a power outage at a nuclear power plant on a single day is the same every day of the year.Also the probability of having a power outage on a single day does not increase or decrease the probability of a power outage on another day.Which of the following distributions would you use to determine the probability that a power outage will occur next Monday?

• A) Binomial distribution.
• B) Poisson distribution.
• C) Hypergeometric distribution.
• D) None of the above.

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Definitions:

Prospect Theory

Prospect Theory is a behavioral economic theory that describes the way people choose between probabilistic alternatives that involve risk, where the probabilities of outcomes are unknown.

Status Quo Bias

The tendency most people have when making choices to select any option that is presented as the default (status quo) option. Explainable by prospect theory and loss aversion.

Behavioral Economics

A field of economics that examines how psychological, cognitive, emotional, cultural, and social factors affect economic decisions.

Utility

A measure of satisfaction or happiness that a consumer derives from consuming goods or services.