Thursday, July 14, 2011

Stat/probability question!?

There is a 1% delinquency rate for consumers with credit rating scores above 800. If the Jefferson Valley Bank provides large loans to 12 people with credit rating scores above 800, what is the probability that at least one of them becomes delinquent? Based on that probability, should the bank plan on dealing with a delinquency? Explain carefully.

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