Independent solution

How to solve this Uniform Distribution question

Setup

Setup

Use the relative lengths on the uniform support to find the two one-appraisal side probabilities.

Pr(A<θ)=34,Pr(A>θ)=14\Pr(A<\theta)=\frac34,\qquad \Pr(A>\theta)=\frac14

Model

Model

The price fails to lie strictly between the sample minimum and maximum only when every appraisal is below it or every appraisal is above it.

Pr(L<θ<H)=1Pr(H<θ)Pr(L>θ)\Pr(L<\theta<H)=1-\Pr(H<\theta)-\Pr(L>\theta)

Compute

Compute

Use independence for the two all-on-one-side events.

Pr(L<θ<H)=1(34)4(14)4\Pr(L<\theta<H)=1-\left(\frac34\right)^4-\left(\frac14\right)^4
=1812561256=174256=0.6796875=1-\frac{81}{256}-\frac1{256}=\frac{174}{256}=0.6796875

Answer

Answer

The straddling probability rounds to 0.680.

0.680(D)\boxed{0.680\quad\text{(D)}}