a) A casino claims that its roulette wheel is truly random. What should that claim mean?

b) A financial reporter says that there is a 50% chance that the Federal Reserve Bank will cut interest rates by a quarter point at their next meeting. What is the meaning of such a phrase?

a) Choose the correct answer below.

A.

The probabilities of all outcomes will add to 1.

B.

The same outcome will not come up twice in a row.

C.

Every outcome will occur before any outcome repeats.

D.

The outcomes are equally likely and independent.

b) Choose the correct answer below.

A.

This is likely an exact probability derived from calculating all the variables that influence the Federal Reserve Bank's decisions.

B.

In the short run, the Federal Reserve Bank will cut interest rates by a quarter point at their next meeting 50% of the time.

C.

In the long run, the Federal Reserve Bank will cut interest rates by a quarter point at their next meeting 50% of the time.

D.

This is likely a personal probability expressing his degree of belief that there will be a rate cut.