Reference no: EM131098113

In a lecture class for 'International Trade', the professor at a University stated that the Exports and Imports during one year of a given country are estimated to have mean values of 80 B$ and 100 B$ with standard deviations of 15B$ and 20 B$ respectively. He also stated that the exports as well as imports can both be considered to follow normal distributions.

a) Calculate the probability that the imports would be more than 110 B$ during the given year.

b) At the end of the lecture, he mumbled that there is only a 10% probability that the exports would be less than some figure that you could not hear. Calculate that value he mentioned/mumbled?

c) Trade Surplus is defined as Exports minus Imports. Calculate the probability that there will be a positive trade surplus.

d) The estimates for the standard deviations for both Exports and Imports were slightly modified downwards and were 12 B$ and 16 B$ respectively. The mean values were unchanged. Taking these changes into account, re-calculate the probability that there will be a positive trade surplus.