Question

In the following problem, check that it is appropriate to use the normal approximation to the binomial. Then use the normal distribution to estimate the requested probabilities.

Do you try to pad an insurance claim to cover your deductible? About 41% of all U.S. adults will try to pad their insurance claims! Suppose that you are the director of an insurance adjustment office. Your office has just received 136 insurance claims to be processed in the next few days. Find the following probabilities. (Round your answers to four decimal places.)

(a) half or more of the claims have been padded


(b) fewer than 45 of the claims have been padded


(c) from 40 to 64 of the claims have been padded


(d) more than 80 of the claims have not been padded

Answer 1

If and if is large and/or is close to , then is approximately .

We use the normal distribution to estimate the requested probabilities. The approximate normal distribution is

a) The probability that half or more of the claims have been padded is

b) The probability that fewer than 45 of the claims have been padded is

c) The probability that from 40 to 64 of the claims have been padded is

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d) The number of claims that have not been padded has approximately

The probability that more than 80 of the claims have not been padded is