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The Credit Risk Department of a major bank estimates the default rate on loans under  $10,000  to be  1% . The bank will make  1100  loans that are under  $10,000  next month.   Answer the following. (If necessary, consult a list of formulas.) (a)Find the mean of  p , where  p  is the proportion of defaults on the  1100  loans under  $10,000  to be made next month.   (b)Find the standard deviation of  p .   (c)Compute an approximation for  P≥p0.02 , which is the probability that  2%  or more of next month's loans under  $10,000  will be defaulted on. Round your answer to four decimal places.

The Credit Risk Department of a major bank estimates the default rate on loans under  $10,000  to be  1% . The bank will make  1100  loans that are under  $10,000  next month.   Answer the following. (If necessary, consult a list of formulas.) (a)Find the mean of  p , where  p  is the proportion of defaults on the  1100  loans under  $10,000  to be made next month.   (b)Find the standard deviation of  p .   (c)Compute an approximation for  P≥p0.02 , which is the probability that  2%  or more of next month's loans under  $10,000  will be defaulted on. Round your answer to four decimal places.

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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Question
The Credit Risk Department of a major bank estimates the default rate on loans under 
$10,000
 to be 
1%
. The bank will make 
1100
 loans that are under 
$10,000
 next month.

 

Answer the following. (If necessary, consult a list of formulas.)
(a)Find the mean of 
p
, where 
p
 is the proportion of defaults on the 
1100
 loans under 
$10,000
 to be made next month.
 
(b)Find the standard deviation of 
p
.
 
(c)Compute an approximation for 
P≥p0.02
, which is the probability that 
2%
 or more of next month's loans under 
$10,000
 will be defaulted on. Round your answer to four decimal places.
 

 

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