At a manufacturing plant where switches are made, it is a known fact that 2% of all switches are defective. If two switches are used in a device, what is the probability that exactly one switch is good?

A switch is good with probability 1 − 0.02 = 0.98, and defective with probability 0.02. Exactly one good switch can happen in either order: good then defective, or defective then good. Thus the probability is 2 × 0.98 × 0.02 = 0.0392, so the correct choice is 0.0392.

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