According to LIMRA, 65% of husband-wife families with kids under 18 years old have life insurance....

According to LIMRA, 65% of husband-wife families with kids under 18 years old have life insurance. A random sample of eight husband-wife families was selected. What is the standard deviation of this distribution?

Assume that the random variable x (number of uninsured drivers) follows a Binomial distribution.

Round to have two decimal places

Solutions

Expert Solution

Given,

65% of husband - wife families with kids under 18 years old have life insurance

Probability that a husband – wife family has insurance for their kids = 65% = 0.65

Probability that a husband – wife family has no insurance(uninsured) for their kids = 1 – 0.65 = 0.35

X is a random variable that represents number of uninsured drivers in the random sample of 8 husband – wife families

And X follows Binomial Distribution with parameters, n = 8, p = 0.35

Standard Deviation = [np(1 - p)]^0.5 = (1.82^0.5) = 1.35 (rounded up to 2 decimal places)

orchestra answered 1 year ago

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