According to the IRS 11 of tax returns will be audited in 20

According to the IRS, 1.1% of tax returns will be audited in 2011. A random sample of 40 tax returns was selected. Use the Poisson distribution to approximate the binomial distribution to determine the probability that more than two of these tax returns will be audited.

Solution

for poisson distribution, mean = np = 40(0.011) = 0.44

by using excel function =1-POISSON(1,0.44,1), P(x>=2) = 0.0726