MGEC58H3 Study Guide - Final Guide: Problem Set, Random Variable, Production Function
13 Dec 2018
School
Department
Course
Professor
Document Summary
Solutions to problem set 5 tournaments and promotion. In order to think about how to compute the probability that worker #1 wins the. 1(a) tournament, we realize that there are two ways to do this. First, we can derive the probability from first principles, or second, we can use the formula i discussed in class. I"ll discuss both of these approaches in the solutions in order for you to see two different ways to arrive at the answer. Recall that if worker #1 wins the tournament, then it must be the case that: As such, the probability that worker #1 wins the tournament is defined as: Of course, thinking about the probability that is greater than some value is dependent upon the distribution of the random variable. Since follows a uniform distribution between 5 and +5, then its probability density function looks like this:
