A corporation is evaluating a proposed merger. The board of directors surveyed 5

Question

A corporation is evaluating a proposed merger. The board of directors surveyed 51 stockholders concerning their position on the merger. The results are reported below: (Round the final answers to 1 decimal Opinion Undecided Total 15 Number of Shares Held Favour Opposed Under 200 200 to under 1000 1000 or more Total 7 20 4 25 51 a. What is the probability that a stockholder holds 1000 or more shares? Probability b. What is the probability that a stockholder holds less than 200 shares and is in favour of the merger? Probability c. What is the probability that a stockholder holds between 200 to under 1000 shares or is opposed to the merger Probability d. What is the probability that a stockholder holds under 200 shares given that he/she is opposed to the merger? Probability

Explanation / Answer

(a) Probability that a stockolhder holds 1000 or more shares = 22/51 = .431 = 43.1%

(b) Probability that stockholder holds less than 200 shares and is in favour of the merger = 7/51 = 0.137 = 13.7%

(c) Required probability = (14+25-7)/51 = 32/51 = 0.627 = 62.7%

(d) Required probability = 7/25 = 0.28 = 28%

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