Question

A MAIL-ORDER FIRM HAS A CIRCULAR WHICH ELICITS A 10 % RESPONSE RATE. SUPPOSE 20 OF THE CIRCULARS ARE MAILED AS A MARKET TEST IN A NEW GEOGRAPHIC AREA. ASSUMING THAT THE 10% RESPONSE RATE IS APPLICABLE IN THE NEW AREA, DETERMINE THE PROBABILITIES OF THE FOLLOWING EVENTS:
A. NO ONE RESPONDS

B. A MAJORITY OF THE PEOPLE RESPOND

C. WHAT IS THE EXPECTED NUMBER OF PEOPLE WILL RESPOND?