Chapter 5, Problem 40PS

The Consumer Financial Protection Bureau’s Consumer Response Team hears directly from consumer about the challenges they face in the marketplace, brings their concerns to the attention of financial institutions and assists in addressing their complaints. Of the consumers who registered a bank account and service complaint, 46% cited “account Management,� complaints related to the marketing or management of an account, as their complaint.

Consider a sample of 20 consumers who registered bank account and service complaints. Use the binomial model to answer the following questions:

a. What is the expected value, or mean, of the binomial distribution?

b. What is the standard deviation of the binomial distribution?

c. What is the probability that 10 of the 20 Consumers cited� account management� as the type of complaint?

d. What is the probability that no more than 5 of the consumers cited “account Management’ as the type of complaint?

e. What is the probability that 5 or more of the consumers cited “account management� as the type of complaint?