an.instructure.com/courses/15981/quizzes/85757/take Question 9 10 pts Wing Foot

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an.instructure.com/courses/15981/quizzes/85757/take Question 9 10 pts Wing Foot is a shoe franchise commonly found in shopping centers across the United States. Wing Foot knows that its stores will not show a proft unless they gross over $940.000 per year. Let A be the event that a new Wing Foot store grosses over $940,000 its first year. Let B be the event that a store grosses over $940,000 its second year. Wing Foot has an administrative policy of closing a new store if it does not show a profit in either of the first two years. Assume that the accounting office at Wing Foot provided the following information: 65% of all Wing Foot stores show a profit the first year: 70% of all Wing Foot store show a profit the second year (this includes stores that did not show a profit the first year); however, 83% of Wing Foot stores that showed a profit the first year also showed a profit the second year. Compute PIA or B) if PIA)-0.65, P(B) -0.70, and P(BIA) 0.83. Round your answer to the nearest hundredth 0.83 0.78 0.52 0.81 0.45 D Question 10 10 pts Diagnostic tests of medical conditions have several results. The rest result can be positive or negative A positive test (+) indicates the natient has the condition A neeative test olindicates the natient

Explanation / Answer

A: Store grosses over $940,000 in its first year
B: Store grosses over $940,000 in the second year

P(A) = 0.65
P(B) = 0.70
P(B | A) = 0.83

Now using bayes theorem, we get here:
P(A and B) = P(B | A)P(A) = 0.83*0.65 = 0.5395

Now using law of addition of probability, we get:
P(A or B) = P(A) + P(B) - P(A and B) = 0.65 + 0.70 - 0.5395 = 0.8105

Therefore 0.81 is the required probability here.

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