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Question 4
The prob. of stock A rising is 0.3; and of
stock B rising is 0.4. What is the prob.
that neither of the stocks rise, assuming
that these two stocks are independent?
1. 0.42
2. 0.12
3. 0.88
4. 0.44
Question 5
If the above stocks are not independent,
and the prob. of both stocks rising is 0.09,
what is the prob. that neither stock rises?
1. 0.69
2. 0.39
3. 0.42
4. 0.52

2007-09-26 04:35:44 · 4 answers · asked by elgriff_2000 2 in Science & Mathematics Mathematics

4 answers

P(A) = 3/10 P(A)' = 7/10
P(B) = 4/10 P(B)' = 6/10

P(AUB)' = P(A)'xP(B)'
7/10x6/10 = 42/10
= .42

if above stocks are not independent
P(A intersection B) = 9/100
P(AUB) = P(A)+P(B) - P(A intersection B)
P(AUB) = 3/10+4/10 - 9/100
P(AUB) = 61/100
P(AUB)' = 1-P(AUB)
1-61/100
39/100
.39

2007-09-26 05:10:33 · answer #1 · answered by Akumar 1 · 1 0

if they are independent, you multiply the probabilities
if they are dependent, you add (or subtract) the probabilities

(1 - 0.3) * (1 - 0.4) = 0.7*0.6 = 0.42
1 - (0.3 + 0.4 - 0.09) = 1 - (0.61) = 0.39

note: if the probability of an event happening is A, the probability that it doesn't happen is 1 - A

2007-09-26 05:01:17 · answer #2 · answered by michaell 6 · 0 0

4. (1 - 0.3)(1 - 0.4) = 0.7*0.6 = 0.42
5. 1 - (0.3 + 0.4 - 0.09) = 1 - (0.61) = 0.39

2007-09-26 04:39:32 · answer #3 · answered by PMP 5 · 0 0

4) 1 - (0.4+0.3 -0.4*0.3) = 1-0.58 = 0.42

5) 1-(0.4+0.3-0.09) = 0.39

2007-09-26 04:43:59 · answer #4 · answered by ag_iitkgp 7 · 0 0

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