It is known that circuit produced by a certain company will be defective with pr

Question

It is known that circuit produced by a certain company will be defective with probability .01, independently of each other. The company sells the products in packages of 100 and offers a money-back guarantee that at most 2 of the 100 circuits is defective ( they replace the package whenever more than 2 are defective). What proportion of packages sold must the company replace?
It is known that circuit produced by a certain company will be defective with probability .01, independently of each other. The company sells the products in packages of 100 and offers a money-back guarantee that at most 2 of the 100 circuits is defective ( they replace the package whenever more than 2 are defective). What proportion of packages sold must the company replace?
It is known that circuit produced by a certain company will be defective with probability .01, independently of each other. The company sells the products in packages of 100 and offers a money-back guarantee that at most 2 of the 100 circuits is defective ( they replace the package whenever more than 2 are defective). What proportion of packages sold must the company replace?

Explanation / Answer

Using Binomial distrbution we solve this problem .

n=100 , x=2 , p=0.01

P(X=2) = nCx* P^x *(1-P)^(n-x)

=100C2 *(0.01)^2 * (0.99)^98

= 0.1848

proportion of packages sold must the company replace IS 18.48%

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