- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 4. Common Probability Distributions
- Subject 5. Binomial Distribution
CFA Practice Question
As part of a promotion for a new type of cracker, free trial samples are offered to shoppers in a local supermarket. The probability that a shopper will buy a packet of crackers after testing the free sample is 0.20. Different shoppers can be regarded as independent trials. Let X be the number among the next twenty shoppers who buy a packet of the crackers after tasting a free sample. The standard deviation of X is ______.
B. 3.20
C. 1.79
A. 4.00
B. 3.20
C. 1.79
Correct Answer: C
X, the number of shoppers who buy a packet of crackers after tasting a free sample, has a binomial distribution with parameters n = 20 and p = 0.2. The standard deviation of X is [np(1-p)]1/2 = 1.79.
User Contributed Comments 4
User | Comment |
---|---|
cleopatraliao | hv to read the question more carefully--"next twenty shoppers..." |
Oregon | same, i calculated the variance and stopped there |
Debashree | same man...i need to remeber np*(1-p) is variance and not std dev. |
gyee2012 | Probability Calc Variance = p (p-1) * n Std = Var^1/2 |