A Canadian Medical Association Study Showed That 20% of All

question 45

Essay

A Canadian Medical Association study showed that 20% of all Canadians suffer from high blood pressure. Suppose we randomly sample ten Canadians to determine the number in the sample who have high blood pressure.
a. What is the probability that, at most, two persons have high blood pressure?
b. If, instead, we sampled 25 Canadians, give a reason why the following statement is true: "The probability between one and nine individuals from a sample of 25 would have high blood pressure is at least 0.75." [Hint: For n and p of approximately the sizes given, the distribution would not be particularly symmetric.]

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Definitions:

Borrowed Funds

Funds obtained through loans or credit, not from direct earnings or investments.

Leverage

The ability to finance an investment through borrowed funds, increasing both the potential for return and the level of risk.

Investment

The act of allocating resources, usually money, with the expectation of generating an income or profit, encompassing stocks, bonds, real estate, and other assets.

Principal

An amount of money borrowed from a lender.