Car Sounds Sells and Installs High-End Sound Systems for Cars

question 34

Multiple Choice

Car Sounds sells and installs high-end sound systems for cars.10% of the systems that the company installs need to be re-installed because of faulty first-time installation.You plan to randomly select 20 of Car Sounds' recent installations.How likely is it that the company will have to re-install no more than one of these systems?

• A).2671
• B).3416
• C).2956
• D).3687
• E).3918

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Definitions:

Cost of Capital

The rate of return that a company must achieve in order to justify the cost of an investment, often influencing investment decisions.

Beta

A unit of measurement for the swings, or integral risk, experienced by a security or portfolio in relation to the wider market.

Common Stock

An equity investment representing ownership in a company, entitling holders to vote at shareholder meetings and receive dividends.

Weighted Average Cost

A method of calculating the total cost of goods sold or assets that weighs each item's cost proportionately.