When you sign up for a credit card, do you read the contract carefully? In a Fin

Question

When you sign up for a credit card, do you read the contract carefully? In a FindLaw.com survey, individuals were asked, "How closely do you read a contract for a credit card?" (USA Today, October 16, 2003). The findings were that 44% read every word, 33% read enough to understand the contract, 11% just glance at it, and 4% dont read it at all.

A. For a sample of 500 people, how many would you expect to say that they read every word of a credit card contract?

B. For a sample of 500 people, what is the probability that 200 or fewer will say they read every word of a credit card contract?

C. For a sample of 500 people, what is the probability that at least 15 say they don't read credit card contracts?

Explanation / Answer

Solution:-

a) n = 500 , read every word = 44%

=> E(x) = 500*0.44 = 220

b) P(X <= 200) = 0.0391

c) P(X >= 15) =0.8998 => dontread = 0.04

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