9. An investor decides to pick from 9 different mutual funds, of which 3 funds a
ID: 3354867 • Letter: 9
Question
9. An investor decides to pick from 9 different mutual funds, of which 3 funds are from Company A and 6 funds are from Company B, using the following method. One fund is chosen at random to receive half of the money to be invested. Then, for the other half, a second fund is chosen at random from the other 8 funds. If it results that money was invested with Company A, what is the probability that all of the money was invested with Company A? (A) .10 (B).15 (C).20(D).25 (F).35 (G)40 (H).45 (I).50 (E).30 (J) .55Explanation / Answer
P(money is invested wth company A) =P(first half in invested with A and second half with A+first half in invested with A and second half with B+first half in invested with B and second half with A)
=(3/9)*(2/8)+(3/9)*(6/8)+(6/9)*(3/8) =42/72
therefore probability that all money is invested with company A
=P(first half in invested with A and second half with A)/P(money is invested wth company A)
=(3/9)*(2/8)/(42/72)=6/42 =1/7 =0.1428 ~ 0.15
option B
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