Based on past experience, a bank believes that 7.5 % of the people who receive loans will not make payments on
time. The bank has recently approved 250 loans.
What must be true to be able to approximate the sampling distribution with a normal model? Before proceeding, think about whether the conditions have been met.
What are the mean and standard deviation of the sampling distribution of the proportion of people who will not make payments on time in samples of 250?
mean, as a decimal =
standard deviation (accurate to 3 decimal places) =
What is the probability that over 10% of the clients in the group of 250 clients will not make timely payments? (accurate to 3 decimal places) (Remember: do not use rounded results in later calculations; rather use the value from prior-to-rounding.)