Homework

  1. A random variable that the possible values can assume values which can be finite or infinite is called discrete.

  2. The probabilities of getting a success or a failure can change from one trial to another is not a property of the binomial experiment.

  3. Here we use Binomial distribution is used&nbspP(number of defaulters) =3% = 0.03&nbspbut q = 1-p = 1-0.03 = 0.97&nbspn = 5&nbspThe common form of binomial distribution for computing the probability of r successes is&nbspP(r) =( nCr)q^(n-r)p^r

Thoughwe need the probability&nbsp=P(r=2) = 5C2*0.97^3*0.03^2&nbsp=0.0082

  1. 60 workers and (24 workers) respectively

  2. Probability distribution

  3. The expected percentage return is 2%

  4. The variance of percentage return is 64.58%

  5. The standard deviation of the percentage return is 2.78%

  6. P(&gt5)=0.0499

  7. Expected percentage return of the portfolio is 8.02%