Homework SourseSweetwater Associates write weekend trip insurance at a ver
Sweetwater & Associates write weekend trip insurance at a very nominal charge. Records show that the probability that a motorist will have an accident during the weekend and filed the claim is 0.0005. Suppose they wrote 498 policies for the coming weekend, what is the probability that exactly two claims will be filed?
Sweetwater & Associates write weekend trip insurance at a very nominal charge. Records show that the probability that a motorist will have an accident during the weekend and filed the claim is 0.0005. Suppose they wrote 498 policies for the coming weekend, what is the probability that exactly two claims will be filed?
Sweetwater & Associates write weekend trip insurance at a very nominal charge. Records show that the probability that a motorist will have an accident during the weekend and filed the claim is 0.0005. Suppose they wrote 498 policies for the coming weekend, what is the probability that exactly two claims will be filed?
Solution
No of policies 498
Proportion for filing the claim = 0.0005
Hence no expected out of 498 to file the claim = 498(0.0005)=0.249
X no of claims is binomial with n =498 and x = 2
P(x =2) = 498C2 (0.0005)2(0.9995)496
=0.02414
=
