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midvinter
12-06-2005, 12:27 PM
The problem is as follows: The amount of money bob earns has an expected value of \$30,000 and a standard deviation of \$3000. The amount fo money that his wife sandy earns has an expected value of \$32,000 and and standard deviation of \$5000. Determine the values eanring of this families:

a) expected value
b) standard deviation

I have been told that these are independant and I have calculated the variance for part B but still cannot figure out what to do next.

JohnM
12-06-2005, 12:48 PM
For independent variables:

(a) the total expected value is the sum of the individual expected values

(b) the total standard deviation is the square root of the sum of the individual variances

midvinter
12-06-2005, 01:27 PM
Thanks for the help I think I was actually doing it all wrong, I have the mean to be \$31,000 and the square root of that to be \$176.07. Now do I subtract that number by the Standard deviations given then add those and divde by 2 to find my overal S.D?

Also for part A is \$63,000 correct? It seemed like it was a bit to easy.

JohnM
12-06-2005, 01:44 PM
Thanks for the help I think I was actually doing it all wrong, I have the mean to be \$31,000 and the square root of that to be \$176.07. Now do I subtract that number by the Standard deviations given then add those and divde by 2 to find my overal S.D?

Also for part A is \$63,000 correct? It seemed like it was a bit to easy.

part a is correct.

for part b, square each standard deviation, then add them together, and take the square root of the sum.