4.3 Exercise 43

Let X = the number of games won in that upcoming month.

The chance of an IRS audit for a tax return reporting more than $25,000 in income is about 2 percent per year. We are interested in the expected number of audits a person with that income has in a 20-year period. Assume each year is independent.

1. In words, define the random variable X.
2. List the values that X may take on.
3. Give the distribution of X. X ~ _____(_____,_____)
4. How many audits are expected in a 20-year period?
5. Find the probability that a person is not audited at all.
6. Find the probability that a person is audited more than twice.