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. A large insurance company sells homeowner's insurance to compensate homeowners in case of damage to their home. Suppose the insurance company's annual payout on a single policy has a severely right-skewed distribution with a mean of $4750 and a standard deviation of $2150. Which of the following best states the Central Limit Theorem in this context? (A) The distribution of annual payouts for all such policies will be approximately normal if the population size is sufficiently large. (B) The distribution of annual payouts in a random sample of these policies will be approximately normal if the sample size is sufficiently large. (C) The distribution of the mean annual payout for many random samples of policies of the same size will be approximately normal if the sample size is sufficiently large. (D) The value of the mean annual payout for a random sample of these policies will be equal to $4,750 if the sample size is sufficiently large. (E) The variability of annual payouts in a random sample of these policies will be smaller for larger sample sizes.

. A large insurance company sells homeowner's insurance to compensate homeowners in case of damage to their home. Suppose the insurance company's annual payout on a single policy has a severely right-skewed distribution with a mean of $4750 and a standard deviation of $2150. Which of the following best states the Central Limit Theorem in this context? (A) The distribution of annual payouts for all such policies will be approximately normal if the population size is sufficiently large. (B) The distribution of annual payouts in a random sample of these policies will be approximately normal if the sample size is sufficiently large. (C) The distribution of the mean annual payout for many random samples of policies of the same size will be approximately normal if the sample size is sufficiently large. (D) The value of the mean annual payout for a random sample of these policies will be equal to $4,750 if the sample size is sufficiently large. (E) The variability of annual payouts in a random sample of these policies will be smaller for larger sample sizes.

Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter10: Statistics
Section10.4: Distributions Of Data
Problem 19PFA
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. A large insurance company sells homeowner's insurance to compensate homeowners in case of damage to their home. Suppose the insurance company's annual payout on a single policy has a severely right-skewed distribution with a mean of $4750 and a standard deviation of $2150. Which of the following best states the Central Limit Theorem in this context? (A) The distribution of annual payouts for all such policies will be approximately normal if the population size is sufficiently large. (B) The distribution of annual payouts in a random sample of these policies will be approximately normal if the sample size is sufficiently large. (C) The distribution of the mean annual payout for many random samples of policies of the same size will be approximately normal if the sample size is sufficiently large. (D) The value of the mean annual payout for a random sample of these policies will be equal to $4,750 if the sample size is sufficiently large. (E) The variability of annual payouts in a random sample of these policies will be smaller for larger sample sizes.
Transcribed Image Text:. A large insurance company sells homeowner's insurance to compensate homeowners in case of damage to their home. Suppose the insurance company's annual payout on a single policy has a severely right-skewed distribution with a mean of $4750 and a standard deviation of $2150. Which of the following best states the Central Limit Theorem in this context? (A) The distribution of annual payouts for all such policies will be approximately normal if the population size is sufficiently large. (B) The distribution of annual payouts in a random sample of these policies will be approximately normal if the sample size is sufficiently large. (C) The distribution of the mean annual payout for many random samples of policies of the same size will be approximately normal if the sample size is sufficiently large. (D) The value of the mean annual payout for a random sample of these policies will be equal to $4,750 if the sample size is sufficiently large. (E) The variability of annual payouts in a random sample of these policies will be smaller for larger sample sizes.
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