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The Mileage of the Hybrid, the Honda Insight, Is Normally

question 11

Essay

The mileage of the hybrid, the Honda Insight, is normally distributed with a mean
of 63.4 mpg and a standard deviation of 12.6 mpg.
-If it is possible to use the Central Limit Theorem, find the probability that the mean of six Honda Insights exceeds 70 mpg.


Definitions:

NPV

Net Present Value, a method used in capital budgeting to assess the profitability of an investment or project.

Payback

Payback is the period of time required for the return on an investment to "pay back" the sum of the original investment, often used as a measure of investment risk.

Cash Flow

Cash flow signifies the net amount of cash and cash-equivalents being transferred into and out of a business, crucial for assessing its liquidity, flexibility, and overall financial performance.

Project's Payback

A calculation that determines the duration required for an investment to generate cash flows or profits enough to recover the initial investment cost.

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