Please do not give solution in image formate thanku. Statewide Auto Insurance believes that for every trip longer than 10 minutes that a teenager drives, there is a 1 in 1,000 chance that the drive will results in an auto accident. Assume that the cost of an accident can be modeled with a beta distribution with an alpha parameter of 1.5, a beta parameter of 3, a minimum value of $500, and a maximum value of $20,000. USING EXCEL - Construct a simulation model to answer the following questions. a. If a teenager drives 500 trips longer than 10 minutes, what is the average cost resulting from accidents? Provide a 95% confidence interval on this mean.
Please do not give solution in image formate thanku.
Statewide Auto Insurance believes that for every trip longer than 10 minutes that a teenager drives, there is a 1 in 1,000 chance that the drive will results in an auto accident. Assume that the cost of an accident can be modeled with a beta distribution with an alpha parameter of 1.5, a beta parameter of 3, a minimum value of $500, and a maximum value of $20,000.
USING EXCEL - Construct a simulation model to answer the following questions.
a. If a teenager drives 500 trips longer than 10 minutes, what is the average cost resulting from accidents? Provide a 95% confidence interval on this mean.
b. If a teenager drives 500 trips longer than 10 minutes, what is the probability that the total cost from accidents will exceed $8,000? Provide a 95% confidence interval on this proportion.
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