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arsen [322]
2 years ago
12

The distribution of income tax refunds follow an approximate normal distribution with a mean of $7010 and a standard deviation o

f $43. All of the income tax returns claiming the largest 0.15 % of refunds will be audited. Use the Empirical Rule to determine approximately above what dollar value must a refund be before it is audited.
Mathematics
1 answer:
Andrej [43]2 years ago
5 0

Answer:

A refund must be above $7,139 before it is audited.

Step-by-step explanation:

The Empirical Rule states that, for a normally distributed random variable:

Approximately 68% of the measures are within 1 standard deviation of the mean.

Approximately 95% of the measures are within 2 standard deviations of the mean.

Approximately 99.7% of the measures are within 3 standard deviations of the mean.

In this problem, we have that:

Mean = 7010, standard deviation = 43.

Approximately 99.7% of the measures are within 3 standard deviations of the mean.

The empirical rule is symmetric, which means that the lowest (100-99.7)/2 = 0.15% is at least 3 standard deviations below the mean, and the upper 0.15% is at least 3 standard deviations above the mean.

Use the Empirical Rule to determine approximately above what dollar value must a refund be before it is audited.

3 standard deviations above the mean, so:

7010 + 3*43 = 7139.

A refund must be above $7,139 before it is audited.

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In 1990 the average family income was about $ 39 , 000 , and in 2010 it was about $ 70 , 768 . Let x = 0 represent 1990, x = 1 r
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Answer:

<em />f(x) = 1588.4x + 39000<em />

f(15) = 62826

Step-by-step explanation:

Given

In 1990; Income= $39000

In 2010; Income= $70768

Solving (a): An equation in form of f(x) = ax + b

First, we need to determine the slope, a

a = \frac{y_2 - y_1}{x_2 - x_1}

Taking y as income and x as year index.

When x = 0; y = 39000

When x = 20; y = 70768

Substitute these values in the above formula

a = \frac{70768 - 39000}{20 - 0}

a = \frac{31768}{20}

a = 1588.4

Next, is to determine the formula using:

y - y_1 = a(x - x_1)

<em>Considering :When x = 0; y = 39000, we have</em>

<em />y - 39000 = 1588.4(x - 0)<em />

<em />y - 39000 = 1588.4x<em />

<em>Make y the subject of formula</em>

<em />y = 1588.4x + 39000<em />

<em />

<em>Express y as a function of x</em>

<em />f(x) = 1588.4x + 39000<em />

Solving (b): Income in 2005

<em>In 2005, x = 15</em>

So:

f(x) = 1588.4x + 39000 becomes

f(15) = 1588.4 * 15 + 39000

f(15) = 62826

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