Risk of ruin, probabilities?

[Hooloovoo]

Can't get my head around the maths :$ If there is 5% possibility that the bank will bust in a month, what is the probability that it will NOT bust over a period of 3 months? I first thought it would be (1-0.05^3) = 0.9996 = 99.9% But i think that is rather the possibility that it would not bust "every month", i.e. that this 5% would strike every month. ....help? :tongue2

[Deleted]

Deleted

Edited May 4, 2020 by Deleted
Deleted