29. Based on past? experience, a bank believes that? 8% of the people who receiv

Question

29.

Based on past? experience, a bank believes that? 8% of the people who receive loans will not make payments on time. The bank has recently approved 600 loans. Describe the sampling distribution model of the proportion of clients in this group who may not make timely payments. Round to the nearest tenth.

A.

meanequals=?8.0%;

standard

deviationequals=?1.1%

B.

meanequals=?92.0%;

standard

deviationequals=?0.3%

C.

meanequals=?8.0%;

standard

deviationequals=?0.3%

D.

meanequals=?92.0%;

standard

deviationequals=?1.1%

E.

There is not enough information to describe the distribution.

Explanation / Answer

mean of sampling distribution , p = 0.08 = 8%

sd of sampling distribution = sqrt(p * (1 - p) / n) = sqrt(0.08 * 0.92 / 600) = 0.0111 = 1.1%

Option-A) mean = 8% and sd = 1.1%

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