Solve the Problem

question 2

Multiple Choice

Solve the problem. Round to the nearest tenth unless indicated otherwise.
-Suppose that replacement times for washing machines are normally distributed with a mean of 8.4 years and a standard deviation of 2 years. Find the replacement time that separates the top 18% from the bottom 82%.

• A) 6.6 years
• B) 9.7 years
• C) 8.8 years
• D) 10.2 years

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Definitions:

Market Price

The present cost at which a product or service is available for purchase or sale in the market.

Strike Price

This is the agreed-upon price within an option contract at which the underlying asset can be bought or sold before the option expires.

Put Option

A financial derivative contract giving the holder the right but not the obligation to sell a specified amount of an underlying asset at a set price before the contract expiration.

Market Price

The current market rate for transactions involving an asset or service.