In a Certain Population, 11% of People Are Left-Handed

question 156

Multiple Choice

In a certain population, 11% of people are left-handed. Suppose that you plan to randomly select 100 people and ask each person whether they are left handed. Suppose that in calculating each of the probabilities below, you use the normal distribution as an approximation to the binomial but that you fail to use a continuity correction. In which cases will you obtain an answer that is too large?
A: the probability that among the 100 people, at least 12 are left-handed
B: the probability that among the 100 people, more than 12 are left-handed
C: the probability that among the 100 people, between 10 and 14 inclusive are left-handed

• A) A and C
• B) B only
• C) B and C
• D) A only

---

Definitions:

Investor

An individual or entity that allocates capital with the expectation of receiving financial returns.

Long-Term Investments-AFS

These are long-term investments in 'Available for Sale Securities' that a company has, which can be sold in the future.

Debt Investments

Financial assets involving the loan of money from an investor to a borrower, often in the form of bonds or loans.

Available-For-Sale Securities

Financial assets that are not classified as held-to-maturity or trading securities, and can be sold in the market.