# Tag Archives: JCM_math230_HW11_S15

## Selling the Farm

Two competing companies are trying to buy up all the farms in a certain area to build houses. In each year 10% of farmers sell to company 1, 20% sell to company 2, and 70% keep farming. Neither company ever sells any of the farms that they own. Eventually all of the farms will be sold. Assuming that there are a large number of farms initially,  what fraction do you expect  will be owned by company 1 ?

[Durrett “Elementary Probability”, p 159 # 39]

A university computer room has 30 terminals. Each day there is a 3% chance that a given terminal will break and a 72% chance that that a given broken terminal will be repaired. Assuming that the fates of the various terminals are independent, in the long run what is the distribution of the number of terminals that are broken ?

[Durrett “Elementary Probability” p. 155 # 24]

## Point of increase

Suppose $$U_1,U_2, …$$ are independent uniform $$(0,1)$$ random variables. Let $$N$$ be the first point of increase. That is to say the first $$n \geq 2$$ such that $$U_n > U_{n-1}$$. Show that for $$u \in (0,1)$$:

1. $\mathbf{P}(U_1 \leq u \ { and } \ N=n)= \frac{u^{n-1}}{(n-1)!}-\frac{u^{n}}{n!} \quad;\quad n \geq 2$
2. $$\mathbf{E}(N)=e$$

Some useful observations:

• $\mathbf{P}(U_1 \leq u \ { and } \ N=n) = \mathbf{P}(U_1 \leq u \ { and } \ N \geq n) -\mathbf{P}(U_1 \leq u \ { and } \ N \geq n+1)$
• The following events are equal
$\{U_1 \leq u \quad{ and } \quad N \geq n\} = \{U_{n-1}\leq U_{n-2} \leq \cdots \leq U_2\leq U_{1} \leq u \}$
• $\mathbf{P}\{U_2 \leq U_1 \leq u \}= \int_0^u \int_0^{u_1} du_2 du_1$

## Expectation of mixture distribution

Consider the following mixture distribution.

1. Draw $$X \sim \mbox{Ber}(p=.3)$$
2. If $$X=1$$ then $$Y \sim \mbox{Geometric}(p_1)$$
3. If $$X= 0$$ then  $$Y \sim \mbox{Bin}(n,p_2)$$

What is $$\mathbf{E}(Y)$$ ?. (*) What is $$\mathbf{E}(Y | X )$$ ?.