Probability
Not what you're looking for?
Ms. Bergen is a loan officer at Coast Bank and Trust. From her years of experience, she estimates that the probability is .025 that an applicant will not be able to repay his or her installment loan. Last month she made 40 loans.
a. What is the probability that 3 loans will be defaulted?
b. What is the probability that at least 3 loans will be defaulted?
Ans; 0.0613
0.0803
Purchase this Solution
Solution Summary
A Complete, Neat and Step-by-step Solution is provided.
Solution Preview
Using Poisson distribution ...
mu = np = 0.025 * 40 = 1
(a) x = 3
P(x) = e^-mu * mu^x / x!
P(3) = e^-1 * 1^3 / 3! = 0.0613
(b) P(At least 3 will be defaulted) = P(x >= 3) = 1 - P(x < 3) = 1 - [P(0) + ...
Purchase this Solution
Free BrainMass Quizzes
Know Your Statistical Concepts
Each question is a choice-summary multiple choice question that presents you with a statistical concept and then 4 numbered statements. You must decide which (if any) of the numbered statements is/are true as they relate to the statistical concept.
Measures of Central Tendency
This quiz evaluates the students understanding of the measures of central tendency seen in statistics. This quiz is specifically designed to incorporate the measures of central tendency as they relate to psychological research.
Measures of Central Tendency
Tests knowledge of the three main measures of central tendency, including some simple calculation questions.
Terms and Definitions for Statistics
This quiz covers basic terms and definitions of statistics.