Solution to Global insurance has found that 20% (1 in 5) of all insurance policies are surrendered … - Sikademy
Author Image

Peace Awoke

Global insurance has found that 20% (1 in 5) of all insurance policies are surrendered (cashed in) before their maturity date. Assume that 10 policies are randomly selected from the policies data base What is the probability that: No more than 3 of these 10 insurance policies will have been surrendered before their maturity date? No more than 3 orders will be recieved?

The Answer to the Question
is below this banner.

Can't find a solution anywhere?

NEED A FAST ANSWER TO ANY QUESTION OR ASSIGNMENT?

Get the Answers Now!

You will get a detailed answer to your question or assignment in the shortest time possible.

Here's the Solution to this Question

Let X= the numbers of insurance policies surrendered (cashed in) before their maturity date: X\sim Bin (n, p).

Given n=10, p=0.2,q=0.8


P(X\le3)=P(X=0)+P(X=1)

+P(X=2)+P(X=3)

=\dbinom{10}{0}(0.2)^0(0.8)^{10-0}+\dbinom{10}{1}(0.2)^1(0.8)^{10-1}

+\dbinom{10}{2}(0.2)^2(0.8)^{10-2}+\dbinom{10}{3}(0.2)^3(0.8)^{10-3}

=0.1073741824+0.268435456

+0.301989888+0.201326592

=0.8791261184

Related Answers

Was this answer helpful?

Join our Community to stay in the know

Get updates for similar and other helpful Answers

Question ID: mtid-4-stid-47-sqid-4383-qpid-102