Everyone gets audited. Wallen Accounting Services specializes in tax preparation
ID: 3130383 • Letter: E
Question
Everyone gets audited. Wallen Accounting Services specializes in tax preparation for individual tax returns. Data collected from past records reveals that 9% of the returns prepared by Wallen have been selected for audit by the Internal Revenue Service. Today, Wallen has six new customers. Assume the chances of these six customers being audited are independent. What is the probability that all six new customers will be selected for audit? What is the probability that none of the six new customers will be selected for audit? What is the probability that exactly one of the six new customers will be selected for audit?Explanation / Answer
a)
Note that the probability of x successes out of n trials is
P(n, x) = nCx p^x (1 - p)^(n - x)
where
n = number of trials = 6
p = the probability of a success = 0.09
x = the number of successes = 6
Thus, the probability is
P ( 6 ) = 5.31441*10^-7 [ANSWER]
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b)
Note that the probability of x successes out of n trials is
P(n, x) = nCx p^x (1 - p)^(n - x)
where
n = number of trials = 6
p = the probability of a success = 0.09
x = the number of successes = 0
Thus, the probability is
P ( 0 ) = 0.567869252 [ANSWER]
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c)
Note that the probability of x successes out of n trials is
P(n, x) = nCx p^x (1 - p)^(n - x)
where
n = number of trials = 6
p = the probability of a success = 0.09
x = the number of successes = 1
Thus, the probability is
P ( 1 ) = 0.336977358 [ANSWER]
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