Homework: HW. 4.3 Score: 0 of 1 pt 3013(2complete) Score: 66.67%, 2 of 3 pts 3.3

Question

Homework: HW. 4.3 Score: 0 of 1 pt 3013(2complete) Score: 66.67%, 2 of 3 pts 3.37 anston Help * unopal bond service has tree rating categories (A B, and C). Suppose that in the past year, ofthe munopal bonds asued thoughout a country, 50% me and 40% were ated B ard 10% were ated cote uopa tores nated A 60% were ssed by tes,30% bysh ts, and tes by raina. Crhem opal bonds eated B. 70% were issued by cies, 10% by buts, and 20% by hral areasolthe muopal bondsaned C·SO% were issued by ebes, S% by kana and 5%bry rural areas. Completo (a)though (c) below a. Ii a new municipal bond is to be issued by a city, what is the probability that it will receive an A rating? 448 (Round tree deonu placei as reeded ) b. What proportion ofl municipal bonds are issued by cites 670 (Round to twee dornal places as nided.) cWhal proportion of municipai bonds ane issued by suburbs? Round to three decimal places as neded) cick Check Anwe Q W E option command command option

Explanation / Answer

a) P(Receive A rating/Issued By city) = (0.60*0.50)/(0.60*0.50+0.70*0.40+0.90*0.10) = 0.448

Answer is 0.448

b) P(Issued by city) = 0.60*0.50+0.70*0.40+0.90*0.10 = 0.670

So, answer is 0.670

c) P(Issued by sururbs) = 0.30*0.50+0.10*0.40+0.05*0.10 = 0.195

So, answer is 0.195

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