Suppose that 75% of the people s hopping in Thibodaux-Boudreaux department store

Question

Suppose that 75% of the people s hopping in Thibodaux-Boudreaux department store use a credit card for purchases. Answer the following questions: (4 decimal places, rounding error will be in thousandths.) 1. What is the probability the next person making a purchase uses a credit card? 2. What is the probability the next person makes a purchase and pays not using a credit card? 3. What is the probability the next two people make purchases using a credit card? 4. What is the probability the next three people make purchases not using a credit card? 5. What is the probability that the next four people all use a credit card?

Explanation / Answer

Given p = 0.75

1 The probability the next person making a purchase uses a credit card is 0.75

2. The probability the next person makes a purchase and pays not using a credit card is 1 - 0.75 = 0.25

3. The probability the next two people make purchases using a credit card is 0.75*0.75 = 0.5625

4. The probability the next three people make purchases not using a credit card is (1-0.75)*(1-0.75)*(1-0.75) =

0.0156

5. The probability that the next four people all use a credit card is 0.75*0.75*0.75*0.75 =0.3164

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