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In: Statistics and Probability

The mean annual inflation rate in the United States over the past 98 years is 3.37%...

The mean annual inflation rate in the United States over the past 98 years is 3.37% and has a standard deviation of approximately 5%. In 2018, the inflation rate was below 1.9%. If the annual inflation rate is normally distributed, what is the probability that inflation rate will be below 1.9% in 2019?

Solutions

Expert Solution

Given that,

mean = = 3.37%=0.037

standard deviation = = 5%=0.05

P(X< 0.019) = P[(X- ) / < (0.019-0.037) / 0.05]

= P(z < -0.36)

Using z table

probability= 0.3594

orchestra answered 2 years ago
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