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Recently, Jamie and Jake each bought new cars. Both received a loan from a local bank with a rate of 10% where payments are made at the end of each month, and they both pay the same monthly payment. Jamie’s loan is for $25,000; however, his loan matures at the end of 4 years (48 months), while Jake’s loan matures in 5 years (60 months). After 48 months Jamie’s loan will be paid off, but what will be the remaining balance on Jake’s loan? Solution.

Formation

Recently, Major League Baseball teams have become concerned about the length of games.
During the 2009 season, games averaged 2 hours and 52 minutes (172) minutes) to complete.
Assume the length of games follows the normal distribution with a standard deviation of 16
minutes. 1.What is the probability that a randomly selected game will be completed in
Solution
a. P(X<200) = P((X-mean)/s <(200-172)/16) =P(Z<1.75) =0.9599 (check standard
normal table) --------------------------------------------------------- b. P(X>150) = P(Z>(150-172)/16)
=P(Z>-1.38) =0.9162 (check standard normal table) -----------------------------------------------------
- c. P(X P(Z<(c-172)/16)=0.9 --> (c-172)/16 =1.28 (check standard normal table) --> c
=172+1.28*16=192.48

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