The chance of an IRS audit for a tax return with over $25,000 in income is about

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The chance of an IRS audit for a tax return with over $25,000 in income is about 2% 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.

a. In words, define the random variable X.

b. List the values that X may take on.

c. Give the distribution of X. X ~ _____(_____,_____)

d. How many audits are expected in a 20-year period?

e. Find the probability that a person is not audited at all.

f. Find the probability that a person is audited more than twice.

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Introductory Business Statistics

ISBN: 202318

1st Edition

Authors: Alexander Holmes , Barbara Illowsky , Susan Dean

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Question Posted: May 10, 2024 02:00 PM

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The chance of an IRS audit for a tax return with over $25,000 in income is about

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Introductory Business Statistics

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