75) A company is considering producing a new children\'s bar soap. A market rese
ID: 3059500 • Letter: 7
Question
75) A company is considering producing a new children's bar soap. A market research firm has told the company that if they perform a survey, a positive survey of a favorable market occurs 65 percent of the time. That is, P(positive survey favorable market) = 0.65. Similarly, 40 percent of the time the survey falsely predicts a favorable market; thus, P(positive survey unfavorable market) =0.40. These statistics indicate the accuracy of the survey. Prior to contacting the market research firm, the company's best estimate of a favorable market was 50 percent. So, P(favorable market) = 0.50 and P(unfavorable market) = 0.50. Using Bayes' theorem, determine the probability of a favorable market given a favorable survey.
A) 0.62
B) 0.38
C) 0.53
D) 0.65
E) None of the above
Answer: A
Explanation / Answer
75) A company is considering producing a new children's bar soap. A market research firm has told the company that if they perform a survey, a positive survey of a favorable market occurs 65 percent of the time. That is, P(positive survey favorable market) = 0.65. Similarly, 40 percent of the time the survey falsely predicts a favorable market; thus, P(positive survey unfavorable market) =0.40. These statistics indicate the accuracy of the survey. Prior to contacting the market research firm, the company's best estimate of a favorable market was 50 percent. So, P(favorable market) = 0.50 and P(unfavorable market) = 0.50. Using Bayes' theorem, determine the probability of a favorable market given a favorable survey.
A) 0.62
B) 0.38
C) 0.53
D) 0.65
E) None of the above
Answer: A
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.