Question

A bank is conducting focus groups to determine the saving habits of its customers. For each session, the bank invites a random group of 20 customers to participate. If 60% of working Americans are not saving for retirement, what is the mean number of customers out of a random selection of 20 who are saving for retirement?

Answer 1

Step 1:

In this question, we are given the following:

Step 2:

The details of the solution are as follows:

Here, people are selected by randomly and each people has a independent and identical probability.

Here number trials is also fixed and each trial has only two outcomes.

so the distribution is clearly binomial distribution.

for a binomial distribution with n trial and Probability of success p ,

mean of this distribution is given by multiplying n with p

mean = n*p

here we have 20 trials . So n=20

here probability of customers not retire = 0.60 (60/100)

then probability of customers retire = 1-0.6=0.4

Here, we need to find mean of saving for retirement in 20 people, since p = 0. 4

then mean= 20 x 0. 4 = 8

so answer is 8

CONCLUSION:

The final answer is:

8 customers.