Answer to Question #137102 in Microeconomics for Massina Veremaito

Question

. Retail price of fuel in Fiji is uniformly distributed between $2.00 and $3.50 per litre.
a. Calculate the retail average price of fuel in Fiji. (1 mark)
b. What is the probability that the price of fuel will be less than $3. Show working. (2 marks)
c. What is the probability that the price of fuel will less than $2. Show working. (2 marks)

Answer 1

a) Retail average price =$\frac{(a+b)} {2}$

=$\frac{(2.0+3.5)}{2}$ =$\frac{5.5}{2}$

Retail average price =$2.75

b) Total number of outcomes is ;

$(3.50-2.00)=1.50$

$3-2.00=1$

Thus the probability will be = $\frac{1}{1.50}$

c) Probability will be zero since

$2-2.00=0$

Giving the probability as $\frac{0}{1.50}=0$