Business Stats

Austin King

2/17/2015

DSCI 245-01

5.49 A foreclosure is a legal process that lender uses to recover the balance of a mortgage owed by a homeowner who has stopped making payments. An unusually high volume of foreclosures occurred during the most recent recession, and as a result, errors were made in the foreclosure process to a significant number of borrowers. For example, auditors found that 24% of foreclosures processed by PNC Financial Services had errors that would have required compensation for the borrowers. A random sample of 5 foreclosures was selected from PNC Financial Services.

a. What is the probability that exactly 3 foreclosures from this sample will have an error that would have required compensation?

b. What is the probability that none of the foreclosures from this sample will have an error that would have required compensation?

c. What is the probability that 2 or fewer foreclosures from this sample will have an error that would have required compensation?

5.59 A first draft of a 400-page manuscript has 36 typos that are spread randomly across the pages. Assume the number of typos per page follows the Poisson distribution.

a. What is the probability that there is one typo in the first 10 pages?

b. What is the probability that there is one typo in the first 20 pages?

c. What is the probability that there are 4 typos in the first 50 pages?

d. What is the probability that are 12 typos in the first 110 pages?

5.71 My department at school is comprised of 10 faculty and 6 administrators. I need to organize a committee of six people from the department. If I randomly select these committee members, determine the probability that the committee consists of the following:

b. Four faculty and two administers; .733