market researchers inc There is a 70% chance the market will be good. When Marke

Question

market researchers inc There is a 70% chance the market will be good. When Market Researchers, Inc., performs the study for this product, the results predict the market will be good. Given the results of this study, what is the probability that the market actually will be good? Policy Pollsters is a market research firm specializing in political polls. Records indicate in past elections, when a candidate was elected, Policy Pollsters had accurately predicted this 80% of the time and they were wrong 20% of the time. Records also show, for losing candidates, Policy Pollsters accurately predicted they would lose 90% of the time and they were only wrong 10% of the time. Before the poll is taken, there is a 50% chance of winning the election. If Policy Pollsters predicts a candidate will win the election, what is the probability that the candidate will actually win? If Policy Pollsters predicts that a candidate will lose the election, what is the probability that the candidate will actually lose? Burger City is a large chain of fast-food restaurants specializing in gourmet hamburgers. A mathematical model is now used to predict the success of new restaurants based on location and demographic information for that area. In the past, 70% of all res-

Explanation / Answer

For candidate elected

80% time correctly predicted

20% worng predicted

for lossing candidate

90% correctly predicted

10% incorrectly predicted

Before poll there is 50% chances if winning

They predicted that a candidate will win.

Chances of the candidate actually wining = 0.8 (as they predict 80% correct if predicted winning )

If they predicted that the candidate will lose

Chances of the candidate actually loosing = 0.99 (as they predict 90% correct if predicted loosing)

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