SOLUTION: 4. Five percent of all credit card holders eventually become delinquent. The probability, rounded to four decimal places, that in a random sample of 21 credit card holders, exactly

Algebra ->  Probability-and-statistics -> SOLUTION: 4. Five percent of all credit card holders eventually become delinquent. The probability, rounded to four decimal places, that in a random sample of 21 credit card holders, exactly      Log On


   

Question 867001: 4. Five percent of all credit card holders eventually become delinquent. The probability, rounded to four decimal places, that in a random sample of 21 credit card holders, exactly 3 will become delinquent is:
Answer by jim_thompson5910(35256) About Me  (Show Source):
You can put this solution on YOUR website!
This is a binomial distribution problem, so we use the formula

(n C k)*(p)^(k)*(1-p)^(n-k)

In this case,

n = 21
p = 0.05
k = 3

So...

(n C k)*(p)^(k)*(1-p)^(n-k) = (21 C 3)*(0.05)^(3)*(1-0.05)^(21-3) = 0.06603688044368


So the answer rounded to 4 decimal places is 0.0660


Note: n C k is the combination formula