The Webster National Bank (WNB), a small Midwestern bank is reviewing its servic

Q: The Webster National Bank (WNB), a small Midwestern bank is reviewing its servic

Answer 1: Note: Chegg mandates answering of first question, although it encourages to answer as much as possible. Kindly repost the remaining questions to get them answered by an expert.

ID: 428994 • Letter: T

Question

The Webster National Bank (WNB), a small Midwestern bank is reviewing its service charges and interest paying policies on checking accounts. The bank presently has a total of 5,000 checking accounts. Tue bank has found that the average daily balance on all of its personal checking accounts is $550 with a standard deviation of $150. In addition, the average daily balances have been found to be normally distributed. Listed below you will find current balance information on just 20 randomly sampled accounts maintained at WNB.

$539

$523

$535

$800

575

$569

$386

$545

700

$565

$810

$559

714

$531

$550

$461

546

$402

$290

$560

1) Determine the mean average account balance based upon the sample data.

2) If you were to draw another random sample of 20 observations from the same population, what is the likelihood (probability) that you would find a larger sample mean than the value you calculated in question 1?

3) WNB has conducted some analysis that reveals that approximately 5 percent of its accounts have an average daily balance below $304. Based upon this information, in a randomly drawn sample of 2,000 accounts, what percentage of accounts could be expected to have au average daily balance below $304?

4) Based upon the population data, what percentage of customers carry average daily balances above

$800?

5) Based upon the population data, what is the daily balance level that would you would expect only 25

percent of the customers to exceed?

6) Based upon the population data, what percentage of customers carry average daily balances below

$200?

7) Based upon the population data, what is the daily balance level that would you would expect 90 percent of the customers to exceed?

8) Based upon the population data, what percentage of customers carry average daily balances between

$200 and $700?

9) WNB has conducted some analysis in consideration of invoking minimum balance requirements because some of its clients maintain unprofitable account balances. If WNB is considering a minimum account balance of $127, how many customers would be expected to have a balance below this value?

10) If WNB chose to model the distribution of average daily balances with the discrete distribution shown below, what is the probability of a customer carrying an average daily balance below $751?

daily balance percent of customers daily balance percent of customers

$1 - $150

0.38%

$551 - $650

24.86%

$151 - $250

1.90%

$651 - $750

15.96%

$251 - $350

6.90%

$751 - $850

6.90%

$351 - $450

15.96%

$851 - $950

1.90%

$451 - $550