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A company starts a fund of M dollars from which it pays
Chapter 2, Problem 16E(choose chapter or problem)
Problem 16E
A company starts a fund of M dollars from which it pays $1000 to each employee who achieves high performance during the year. The probability of each employee achieving this goal is 0.10 and is independent of the probabilities of the other employees doing so. If there are n = 10 employees, how much should M equal so that the fund has a probability of at least 99% of covering those payments?
Questions & Answers
QUESTION:
Problem 16E
A company starts a fund of M dollars from which it pays $1000 to each employee who achieves high performance during the year. The probability of each employee achieving this goal is 0.10 and is independent of the probabilities of the other employees doing so. If there are n = 10 employees, how much should M equal so that the fund has a probability of at least 99% of covering those payments?
ANSWER:
Answer :
Step 1 of 2 :
Given, a company starts a fund M dollars from which it pays $1000 to each employee who achieves high performance during the year.
0.10 be the probability of each employee achieving this goal.
The claim is to find how much should M equal, so that the fund has a probability of at least 99% of covering those payments, when n = 10 employees.