Concept:Use mean and variance formulas to find unknown observations. Then find probability using complementary event.Explanation:Given mean = 8, so 72+4+10+x+12+14+y​=8.Simplify: 2+4+10+12+14=42, so 42+x+y=56.Thus x+y=14.Given variance = 16, formula: 7∑xi2​​−(mean)2=16.Compute squares: 22=4, 42=16, 102=100, 122=144, 142=196. Sum = 4+16+100+144+196=460.So 460+x2+y2=7(16+64)=7×80=560.Therefore x2+y2=100.Now x+y=14 and x2+y2=100. Solve: (x+y)2=x2+y2+2xy gives 196=100+2xy, so 2xy=96, xy=48.Thus x and y are roots of t2−14t+48=0: (t−6)(t−8)=0, so (x,y)=(8,6) since x>y.New set: {1,2,3,x−4,y,5}={1,2,3,4,6,5} which is {1,2,3,4,5,6}.We want probability that the smaller of two numbers chosen without replacement is less than 4.Probability = 1−P(both numbers≥4).Numbers ≥4 in set: {4,5,6} (3 numbers). Total numbers: 6.P(both≥4)=6C2​3C2​​=153​=51​.Thus required probability = 1−51​=54​.Answer:54​ (Option A)