You have chosen biology as your college major because you would like to be a medical doctor. However, you find that the probability of

being accepted to medical school is about $20$ percent. If you are accepted to medical school, then your starting salary when you

graduate will be $$210,000$ per year. However, if you are not accepted, then you would choose to work in a zoo, where you will earn

$$48,000$ per year. Without considering the additional years you would spend in school if you study medicine or the time value of

money.

Problem $7\mathrm{.}03$ a$1-$a$2($a$1)$

$$ Your answer is correct.

What is your expected starting salary?

Expected starting salary

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Problem $7\mathrm{.}03$ a$1-$a$2($a$2)$

What is the standard deviation of that starting salary?