Problem 99d

Given information

As per the given question,

• The chance of an IRS audit for a tax return with over $ in income is about % per year.
• We are interested in the expected number of audits a person with that income has in a -year period.
• Assume each year is independent.

To find:- Part (d). How many audits are expected in a -year period?

Step-by-step explanation

As per the given question,

                  We can express the average value for the required binomial distribution as follows:-

                                            , where is and is .

                                       or,  ,

                                       or,