Question

In economics, of all new products put on the market, 60% failed and are taken off the market within 2 years. Suppose a store introduces 80 new products. Use the normal approximation for the binomial distribution what is the probability that within 2 years 56 or less will fail with correction for continuity?

Answer 1

given data are:-

n = 80

p = 60% = 0.60

q = (1-p) = (1-0.60) = 0.40

assumptions:-

np = (80*0.60)= 48 > 5

nq = (80*0.40) = 32 >5

so, the assumptions are satisfied.We can use normal approximation to binomial.

the probability that within 2 years 56 or less will fail is:-

[ continuity correction ]

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