Sweetwater & Associates write weekend trip insurance at a very nominal charge. Records show that the probability that a motorist will have an accident during the weekend and file a claim is 0.00555. Suppose they wrote 400 policies for the coming weekend, what is the probability that exactly two claims will be filed?

Question

Quizplus · Accepted Answer

The probability of exactly two claims can be calculated using the binomial probability formula: P(X=k) = (n choose k) * p^k * (1-p)^(n-k), where n=400, k=2, and p=0.00555. Calculating this gives approximately 0.0164.

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