(Y) companies. The debt percentages vary from 20% to 80%. Carla has defined DM as a variable for the mature companies from 0 to 1, with DM = 0 interpreted as the low of 20% debt and DM = 1.0 as the high of 80% debt. The variable for young corporation debt percentages DY is similarly defined. The probability distributions used to describe DM and DY are
f (DM) = 3(1 ? DM)² 0 ? DM ? 1
f (DY) = 2DY 0 = DY ? 1
(a) Use different values of the debt percentage between 20% and 80% to calculate values for the probability distributions and then plot them.
(b) Comment on the probability that a mature company or a young company will have a low debt percentage? A high debt percentage?
 FIGURE 4.png)
 ANSWER.png)
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