# Question

Economists at the University of New Mexico modeled the number of casualties (deaths or missing persons) experienced by a deep-draft U.S. flag vessel over a three-year period as a Poisson random variable x. The researchers estimated E(x) to be .03 (Management Science, Jan. 1999).

a. Find the variance of x.

b. Discuss the conditions that would make the researchers’ Poisson assumption plausible.

c. What is the probability that a deep-draft U.S. flag vessel will have no casualties over a three-year period?

a. Find the variance of x.

b. Discuss the conditions that would make the researchers’ Poisson assumption plausible.

c. What is the probability that a deep-draft U.S. flag vessel will have no casualties over a three-year period?

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