Age Group Insured Drivers (%) Accident Rate (%) Under 25 16 6.5 25–44 40 1.5 45–64 30 2 65 and over 14 4
Contingency Table
A contingency table can be defined as the visual representation of the relationship between two or more categorical variables that can be evaluated and registered. It is a categorical version of the scatterplot, which is used to investigate the linear relationship between two variables. A contingency table is indeed a type of frequency distribution table that displays two variables at the same time.
Binomial Distribution
Binomial is an algebraic expression of the sum or the difference of two terms. Before knowing about binomial distribution, we must know about the binomial theorem.
An insurance company has compiled the accompanying data relating the age of drivers and the accident rate (the probability of being involved in an accident during a 1-year period) for drivers within that group.
| Age Group | Insured Drivers (%) | Accident Rate (%) |
|---|---|---|
| Under 25 | 16 | 6.5 |
| 25–44 | 40 | 1.5 |
| 45–64 | 30 | 2 |
| 65 and over | 14 | 4 |
What is the probability of the following? (Round all answers to two decimal places.)
(b) An insured driver selected at random who is involved in an accident is under 25.
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