The credit risk department of a major bank estimates the default rate on loans under $10,000 to

Fantastic news! We've Found the answer you've been seeking!

Question:

The credit risk department of a major bank estimates the default rate on loans under $10,000 to be 2%. A random sample of 1600 new loans under $10,000 is going to be ^P be the proportion of defaults on the loans in the sample.

a). Find the mean of ^p=

b). Find the standard deviation of ^p.

c). Compute an approximation for P(^p >O.3) , which the probability that 3% or more of the loans in the sample will be defaulted on. Round your answer to 4 decimal places.

Posted Date: May 18, 2024 07:14 PM

See More Questions

Verde Company produces wheels for bicycles. During the year, 657,000 wheels were produced. The actual labor used was 368,000 hours at $9.50 per hour. Verde has the following labor standards: 1)...
During the past year, Stacy McGill planted a new vineyard on 150 acres of land that she leases for $30,000 a year. She has asked you, as her accountant, to assist her in determining the value of her...
Slow Burn Candle, Inc., a public company, asked its CPA, Parker Granger, to assist it in preparing footnotes for unaudited financial statements as of June 30, 19X5. Granger has previously audited the...
(a) Identify the eight main beadings under which a company's cash flows must be analysed when preparing an FRS1 cash flow statement. (b) Define the term "liquid resources". (c) Identify the two...
The beginning inventory for Francesca Co and data on purchases and sales for a three-month period are shown in Problem 7-1B. Instructions 1. Record the inventory, purchases, and cost of merchandise...
In Activity 1 you will classify a set of common account titles into the primary account classifications in any business organization: Assets, Liabilities, Equity, Revenues and Expenses. In addition,...
19. Three towns, Alphaville, Betaton, Gamma Hills, are being developed, Gamma Hills as shown on the map. Given the information on the map, which two towns are closest to each other? 44 miles 370 A....
You are a security consultant who has been employed by First Singaporean, a large bank based in Singapore, to examine the adequacy of security controls over a new site that it established nine months...
Looking at the company where you work (use a company that you know well, if you are not currently working), does it appear that the organization uses task-based or competency-based job analysis? Why...
Briefly define what is meant by a security program. What are the eight major steps that must be undertaken during the conduct of a security program?
Why is it important that a project plan be prepared for a security program? Who should be responsible for preparing the plan? Who should be responsible for approving the plan?
Orchard Enterprises Limited (OEL) is a medium-sized Miami-based distributor of leisureware fashion garments. It has a mainframe computer in its Miami headquarters to process its major application...
Joshua, a research student, is in the data analysis stage of the scientific method. He intends to look for patterns in the quantitative data. What step should he take next? Select a Choice Below...
Identify the most stable compound:
Why would it be important to have a performance management system linked to and relatively consistent across all levels in an organization?
How could one tell whether the metrics used for performance evaluations were KPIs?
Read the article The Top 50 Problems with Performance Appraisals at www.eremedia.com/tlnt/the-top-50-problems-with-performanceappraisals/ (Sullivan 2011). According to the chapter, what steps can be...

The credit risk department of a major bank estimates the default rate on loans under $10,000 to

Question:

Expert Answer:

Students also viewed these mathematics questions