1. An insurance company classifies drivers as low-risk, medium-risk, and high-risk. Sixty percent of those insured are low-risk, 30% are medium-risk, and 10% are high-risk. After a study, the company finds that during a one-year period, 1% of the low-risk have an accident, 5% of the medium-risk have an accident, 9% of the high-risk have an accident. If a driver is selected at random, what is the probability that the driver will have an accident during that year (P(A) = ___)? Define the simple events necessary to answer the question. H: Event driver is high risk M: Event driver is medium risk L: Event driver is low risk A: Event driver has an accident A similar application is worth a boatload of points on exams. A. Provide the probability statements (for these simple events) with their probabilities based on the information given in the scenario.
1. An insurance company classifies drivers as low-risk, medium-risk, and high-risk. Sixty percent of those insured are low-risk, 30% are medium-risk, and 10% are high-risk. After a study, the company finds that during a one-year period, 1% of the low-risk have an accident, 5% of the medium-risk have an accident, 9% of the high-risk have an accident. If a driver is selected at random, what is the probability that the driver will have an accident during that year (P(A) = ___)? Define the simple events necessary to answer the question. H: Event driver is high risk M: Event driver is medium risk L: Event driver is low risk A: Event driver has an accident A similar application is worth a boatload of points on exams. A. Provide the probability statements (for these simple events) with their probabilities based on the information given in the scenario.
A First Course in Probability (10th Edition)
10th Edition
ISBN:9780134753119
Author:Sheldon Ross
Publisher:Sheldon Ross
Chapter1: Combinatorial Analysis
Section: Chapter Questions
Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...
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Transcribed Image Text:1. An insurance company classifies drivers as low-risk, medium-risk, and high-risk. Sixty percent
of those insured are low-risk, 30% are medium-risk, and 10% are high-risk. After a study, the
company finds that during a one-year period, 1% of the low-risk have an accident, 5% of the
medium-risk have an accident, 9% of the high-risk have an accident. If a driver is selected at
random, what is the probability that the driver will have an accident during that year (P(A) = ___)?
Define the simple events necessary to answer the question.
H: Event driver is high risk
M: Event driver is medium risk
L: Event driver is low risk
A: Event driver has an accident
A similar application is worth a
boatload of points on exams.
A. Provide the probability statements (for these simple events) with their probabilities based
on the information given in the scenario.
Do not provide any numbers in your written work for parts B, C, and D.
B. Provide a tree diagram. Show the appropriate probability statements. No numbers.
Observe:
P(LOA) =
P(MOA) =
P(HA) =
C. Provide a Venn diagram showing the appropriate events.
Observe:
1. A =
2. (LOA), (MOA), and (HA) are:
D. Provide the sequence of 3 formulas necessary to determine the probability that
the driver will have an accident during that year? Justify how the formulas were
developed (i.e., provide your strategies used to develop the three formulas).
No numbers.
P(A) =
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