Solution Found!
Geometric Distribution: Mean and Variance In Exercise, use
Chapter 4, Problem 30EC(choose chapter or problem)
Problem 30EC
Geometric Distribution: Mean and Variance In Exercise, use the fact that the mean of a geometric distribution is µ = 1/p and the variance is σ2 = q/p2.
Paycheck Errors A company assumes that 0.5% of the paychecks for a year were calculated incorrectly. The company has 200 employees and examines the payroll records from one month. (a) Find the mean, variance, and standard deviation. (b) How many employee payroll records would you expect to examine before finding one with an error?
Questions & Answers
QUESTION:
Problem 30EC
Geometric Distribution: Mean and Variance In Exercise, use the fact that the mean of a geometric distribution is µ = 1/p and the variance is σ2 = q/p2.
Paycheck Errors A company assumes that 0.5% of the paychecks for a year were calculated incorrectly. The company has 200 employees and examines the payroll records from one month. (a) Find the mean, variance, and standard deviation. (b) How many employee payroll records would you expect to examine before finding one with an error?
ANSWER:
Solution :
Step 1 of 2:
Given for the mean and variance.
The mean formula is
=
Then the variance formula is
From the given information we know that p value.
p =
p = 0.005
Let n denotes the company has 200 employees.
So, n=200.
Our goal is: