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Miscellaneous Exercise · Q1

Q.An investment banker finalises the list of specific entities worthy of investment in each of the 3 instruments given below: 3 private limited companies for direct equity investment, 5 mutual fund schemes, 2 banks for making fixed deposits. In how many ways the investment can be made if:

(i) the banker decides to invest the entire fund only in entity
(ii) the banker chooses to invest in one entity of each of the three instruments.
Yanam CbseNCERTSubjective· 3mImportance★★★★★est
90% · 114/126 Questions
✓ Free question

There are 3+5+2=103+5+2=10 entities in all; part (i) is a sum-rule choice (one entity overall) and part (ii) is a product-rule choice (one entity from each of the three independent instruments).

Sum rule: if a choice is made from ONE of several mutually exclusive groups of sizes n1,n2,…n_1,n_2,\ldots, the total number of ways is n1+n2+⋯n_1+n_2+\cdots.

Product rule: if a choice is made from EACH of several independent groups of sizes n1,n2,…n_1,n_2,\ldots, the total number of ways is n1×n2×⋯n_1\times n_2\times\cdots.

  1. The three instruments offer 33 companies, 55 mutual fund schemes, and 22 banks — 3+5+2=103+5+2=10 entities in total.
  2. (i) Entire fund in only one entity. The banker picks a single entity (from any instrument) to put the whole fund into — this is a "choose one of the 10" (sum-rule) situation: 3+5+2=103+5+2=10 ways.
  3. (ii) One entity of each instrument. The banker must pick 1 company and 1 mutual fund and 1 bank — three independent, simultaneous choices, so multiply: 3×5×23\times5\times2.
  4. Compute 3×5×2=15×2=303\times5\times2=15\times2=30.
✓Final answer

(i) 1010 ways (ii) 3030 ways.

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