6
QuizMultiple Choice

Taxes — Test

Question 6 • Financial Math

A company's annual income tax data for 2022 shows a mean annual employee income of $⁢60,000 , with a standard deviation of annual income of $⁢10,000 Assume that the incomes are normally distributed. What percentage of the company's employees have an annual income between $⁢50,000 and $⁢70,000 ?

Answer
A
68 percent
B
34 percent
C
95 point 4 percent
D
99 point 7 percent

Explanation

The interval from $50,000 to $70,000 is $10,000 below and above the mean of $60,000. Since $10,000 is one standard deviation, this interval is within one standard deviation of the mean. For a normal distribution, about 68 percent of values lie within one standard deviation, so the answer is 68 percent.

AI-written and checked against the verified answer.

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