Statistics for Business: Decision Making and Analysis, 3rd Edition

You Do It

1. 39.

   1. 0.93319

   2. 0.8413

   3. 0.7699

   4. 0.6171

   5. 0.77449

2. 41.

   1. − 0.84

   2. 0

   3. 0.6745

   4. 2.576

   5. 1.645

3. 43.

   1. $33,000

   2. Approximately 21%.

4. 45.

   1. 0.025

   2. A normal model with μ = np = 25 and σ² = np(1 − p) = 24.375 gives ≈ 0.00423. The exact binomial model gives ≈ 0.00514.

   3. Yes, to the extent that the company can be profitable by writing many policies whereas it would not if it only sold a few.

5. 47.

   1. 5%

   2. 5%

   3. The life insurance firm has independent customers. They don't all die at once. The hurricane bonds do and are dependent. These bonds are more risky than insurance.

6. 49.

   1. The histogram and boxplot look like a reasonable match for a normal model. The histogram is roughly bell-shaped with some skewness and a sharp cutoff near 30%. The boxplot does not show many outliers. ...