- CFA Exams
- CFA Level I Exam
- Study Session 3. Quantitative Methods (2)
- Reading 9. Common Probability Distributions
- Subject 5. The 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 100 shoppers who buy a packet of the crackers after tasting a free sample. X has approximately a ______.
A. N(4, 20) distribution
B. N(20, 4) distribution
C. N(0.2, 16) distribution
Explanation: The distribution is approximately normal with mean np = 20 and standard deviation [np(1-p)]1/2 = 4.
User Contributed Comments 1
| User | Comment |
|---|---|
| Pooh | Binomial probability: N(mean, stdev.) |