SOLUTION: The bank of of Hawaii reported that 7% of its credit card holders will default at some time in their life. the Hilo branch just mailed out 12 new card
what is the likelywood tha
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: The bank of of Hawaii reported that 7% of its credit card holders will default at some time in their life. the Hilo branch just mailed out 12 new card
what is the likelywood that none of the card holder will default
what is the likelyhood that at least one will default
This question is from textbook
Answer by stanbon(75887) (Show Source): You can put this solution on YOUR website!
The bank of of Hawaii reported that 7% of its credit card holders will default at some time in their life. the Hilo branch just mailed out 12 new card
what is the likelyhood that none of the card holders will default
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Both problems are binomial because either a customer defaults or he doesn't.
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P(no defaults) = 12C0(0.07)^0*(0.93)^12 = 0.93^12 = 0.4186
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what is the likelyhood that at least one will default
P(at least one default) = 1 - P(no defaults) = 1-0.4186 = 0.5814
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Cheers,
Stan H.
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