108k views
3 votes
According to the Insurance Institute of America, a family of four spends between $400 and $3,800 per year on all types of insurance. Suppose the money spent is uniformly distributed between these amounts. If we select a family at random, what is the probability they spend less than $2,000 per year on insurance per year? (Round your answer to 4 decimal places.)

1 Answer

4 votes

Answer:

0.471

Explanation:

Calculation for the probability that they spend less than $2,000 per year on insurance per year

First step is to find the base

Base =$2,000-$400

=$1,600

Second step is to find the probability using this formula

P=1/b+a×base

Where,

b represents $3,800

a represents $400

base represents $1,600

Let plug in the formula

P=1/$3,800-$400×$1,600

Hence,

P=1×$1,600/$3,800-$400

P=$1,600/$3,400

P=0.471

Therefore the probability that they spend less than $2,000 per year on insurance per year will be 0.471

User Zajer
by
8.3k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.