Dollar amount of damage, The dollar amount of damage

Dollar amount of damage

Reference no: EM131005779

1. Suppose that the amount of time one spends in a bank is exponentially distributed with mean ten minutes, that is, λ = 1 . What is the probability that a customer will spend more than ?fteen minutes in the bank? What is the probability that a customer will spend more than ?fteen minutes in the bank given that she is still in the bank after ten minutes?

2. The dollar amount of damage involved in an automobile accident is an exponential random variable with mean 1000. Of this, the insurance company only pays that amount exceeding (the deductible amount of) 400. Find the expected value and the standard deviation of the amount the insurance company pays per accident.

Reference no: EM131005779

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