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**careless25****Real Member**- Registered: 2008-07-24
- Posts: 560

At a bank, the interest is calculated on 100 accounts and rounded up or down

to nearest cent. If it is assumed that the round-off error is uniformly distributed between

(-1/2, 1/2) and

the round-off errors are independent, find the probability that the sum

of the error does not exceed 2 cents in magnitude.

I dont understand how to calculate the variance for just one account. the answer for variance for just one account is 1/12.

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**bobbym****bumpkin**- From: Bumpkinland
- Registered: 2009-04-12
- Posts: 109,606

Hi;

I am getting:

**In mathematics, you don't understand things. You just get used to them.****If it ain't broke, fix it until it is.**** Always satisfy the Prime Directive of getting the right answer above all else.**

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**careless25****Real Member**- Registered: 2008-07-24
- Posts: 560

Hi bobbym,

Yes that is the correct answer. I was asking about calculating the variance not the probability.

Var(X) = E(x^2) - E(x)^2

and f(x) = 1 as this is uniform distribution from -1/2 to 1/2.

so:

Using Central Limit Theorem:

is the square root of the variance calculated above.is the standard distribution.

Therefore P(-2 <= x <= 2) = 0.512

*Last edited by careless25 (2014-08-02 18:26:22)*

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