After examining their clients\' records, Crashorama Auto Insurance calculated th

Question

After examining their clients' records, Crashorama Auto Insurance calculated the probabilities in the figure below.

(a) Find the probability that the client drives less than 10,000 miles/year and has an accident.


(b) Find the probability that a client drives less than 10,000 miles/year or has an accident.


(c) Find the probability that a client does not drive less than 10,000 miles per year and does not have an accident.

Miles/Year
< 10,000 10,000
Miles/Year
< 20,000 20,000
Miles/Year Accident 0.06 0.09 0.27 No accident 0.21 0.16 0.21

Explanation / Answer

Using the table to answer all the 3 parts of the question:

a.

P( drive<10000 & accident) = .06

b.

P( drive<10000 or accident)
= P(drive<10000)+P(accident)-P( drive<10000 & accident)
=(.06+.21)+(.06+.09+.27)-.06
=.63

c.

P( drive>=10000 & no accident)
=.16+.21
=.37

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