Insurance policies are sold to 10 different people age 25-30 years. All of these are in good health
conditions. The probability that a person of similar condition will enjoy more than 25 years is 4/5. Calculate
the probability that in 25 years
a) Almost 2 will die.
It will be P(X=0) +P(X=1)+P(X=2)
probability of living = 4/5 = 0.8
prob of dying = 0.2
So p will be prob of dying = 0.2 and hence q will be 0.8
So P(X=0) : 10C0*(prob of dying)^x *(prob of not dying)^n-x
= 10C0*(prob of dying)^x *(prob of not dying)^n-x
= 10C0*(0.2)^0 *(0.8)^10-0
= 0.10737
So P(X=1) : 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C1*(0.2)^1 *(0.8)^10-1
= 0.268435
So P(X=2) : 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C2*(0.2)^2 *(0.8)^10-2
= 0.30198
So sum them all = 0.6777 Ans
Please tell have I done it correctly?
conditions. The probability that a person of similar condition will enjoy more than 25 years is 4/5. Calculate
the probability that in 25 years
a) Almost 2 will die.
It will be P(X=0) +P(X=1)+P(X=2)
probability of living = 4/5 = 0.8
prob of dying = 0.2
So p will be prob of dying = 0.2 and hence q will be 0.8
So P(X=0) : 10C0*(prob of dying)^x *(prob of not dying)^n-x
= 10C0*(prob of dying)^x *(prob of not dying)^n-x
= 10C0*(0.2)^0 *(0.8)^10-0
= 0.10737
So P(X=1) : 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C1*(0.2)^1 *(0.8)^10-1
= 0.268435
So P(X=2) : 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C1*(prob of dying)^x *(prob of not dying)^n-x
= 10C2*(0.2)^2 *(0.8)^10-2
= 0.30198
So sum them all = 0.6777 Ans
Please tell have I done it correctly?