Thread: Statistics: Warranty Problem

Studies show that the average life of a certain brand of mp3 player is 5 years, with a standard deviation of 0.8 years. A company wants to sell 1,000 of these players. Determine the guarantee period to the nearest month so no more than 20 players are returned under warranty.

If anyone could help me, it would be much appreciated. Thanks!

Originally Posted by Peachy

Studies show that the average life of a certain brand of mp3 player is 5 years, with a standard deviation of 0.8 years. A company wants to sell 1,000 of these players. Determine the guarantee period to the nearest month so no more than 20 players are returned under warranty.

If anyone could help me, it would be much appreciated. Thanks!

Have you been told what distribution the life follows (eg. normal)?

No, that was the question exactly. I guess you could assume that it was normal distribution, though?

Originally Posted by Peachy

No, that was the question exactly. I guess you could assume that it was normal distribution, though?

Certainty cannot be guaranteed:

so no more than 20 players are returned under warranty

No matter what the warranty period, there will always be a non-zero probability of more than 20 being returned. Obviously the longer the period, the closer to 1 the probability that no more than 20 will be returned will be. But that probability can never be equal to 1 ..... You need to fnd out form the book or your instructor with what probability do you want no more than 20 to be returned ... (0.95, 0.99 ....?)