Question

if a driver is selected at random what is the probability that

Insurance. By examining the past driving records of drivers in a certain city, an insurance company has determined the following (empirical) probabilities Less than 10,000 M .05 .15 20 Miles Driven per Year 10,000 - 15,000 Inclusive, M .10 .20 .30 More than 15,000, M .25 25 .50 Accident No Accident Totals Totals .40 .60 1.0 If a driver in this city is selected at random, what is the probability that a. He or she drives less than 10,000 miles per year or has an accident? (Type a decimal) b. He or she drives 10,000 or more milos per year and has no accidents? (Type a decimal)

Answer 1

a. Probability that he or she drives less than 10000 miles per year or has an accident = Probability that he or she drives less than 10000 miles per year + Probability that he or she has an accident - Probability that he or she drives less than 10000 miles per year and has an accident = 0.20+0.40-0.05=0.55

b. Probability that he or she drives more than 10000 miles per year and has no accident = Probability that he or she has no accident - Probability that he or she drives less than 10000 miles per year and has no accident = 0.60-0.15=0.45