The following chart shows the results of a survey of the status of subprime home

Question

The following chart shows the results of a survey of the status of subprime home mortgages in a certain state in November 2008. Mortgage Status Current Past Due In Foreclosure Repossessed Frequency 115 70 60 (The four categories are mutually exclusive; for instance, "Past Due" refers to a mortgage whose payment status is past due but is not in foreclosure, and "In Foreclosure" refers to a mortgage that is in the process of being foreclosed but not yet repossessed Enter your answers to two decimal places.) (a) Find the relative frequency distribution for the experiment of randomly selecting a subprime mortgage in the state and determining its status Current Past Due In Foreclosure Repossessed (b) What is the relative frequency that a randomly selected subprime mortgage in the state was neither in foreclosure nor repossessed? HINT [See Example 2. Need Help? Read it

Explanation / Answer

a) Current = 115/250 = 0.46

Past due = 70/250 = 0.28

In Foreclosure = 60/250=0.24

Repossed = 5/250 = 0.02

b) P = 1-0.24-0.02 = 0.74

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