Use the Following Information to Answer the Problem(s)below

question 100

Multiple Choice

Use the following information to answer the problem(s) below.
Consider two banks.Bank A has 1000 loans outstanding each for $100,000,that it expects to be fully repaid today.Each of Bank A's loans have a 6% probability of default,in which case the bank will receive $0 for each of the defaulting loans.Bank B has 100 loans of $1 million outstanding,which it also expects to be fully repaid today.Each of Bank B's loans have a 5% probability of default,in which case the bank will receive $0 for each of the defaulting loans.The chance of default is independent across all the loans.
-The standard deviation of the overall payoff to Bank A is closest to:

• A)$689,000.
• B)$751,000.
• C)$2,179,000.
• D)$2,375,000.

---

Definitions:

Hormone Levels

The concentration of hormones present in the bloodstream, which can influence various bodily functions and processes.

Lamaze Technique

A childbirth preparation method focusing on various strategies to cope with pain during labor, emphasizing breathing techniques and the support of a childbirth coach.

Medical Births

Childbirth overseen and managed by healthcare professionals, often involving medical interventions.

Caesarean Births

Surgical procedures used to deliver a baby through incisions in the mother's abdomen and uterus, performed when vaginal delivery would put the baby or mother at risk.