A bank found that 24% of its loans to new businesses become delinquent. If 200 small businesses are selected randomly from the bank’s files, what is the probability that at least 60 of them are delinquent? (using normal distribution)
Added by Holly R.
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Since 24% of the loans become delinquent, the expected number of delinquent loans in a sample of 200 small businesses is 0.24 * 200 = 48 loans. Show more…
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12. A bank found that 24% of its loans to new businesses become delinquent. If 200 small businesses are selected randomly from the bank's files, what is the probability that at least 60 of them are delinquent? a. Show that that this binomial distribution can be approximated using the normal distribution. [2] b. Calculate the mean and standard deviation. [2] c. Using the normal approximation, find the probability that at least 60 of them are delinquent? Use the Normal Distribution chart provided at the back. [3]
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