As manager for a construction firm, you are in charge of bidding on two large co

Question

As manager for a construction firm, you are in charge of bidding on two large contracts. You believe the probability you get contract#1 is 0.8. If you get contract #1, the probability you also get contract #2 will be 0.2, and if you do not get #1, the probability you get #2 will be 0.7. Complete parts (a) through (c) a) Sketch the probability tree. b) What is the probability you will get both contracts? (Type an integer or a decimal.) c) Your competitor hears that you got a second contract but hears nothing about the first contract. Given that you got the second contract, what is the probability that you also got the first contract? (Round to three decimal places as needed.)

Explanation / Answer

P( Contract 1 and 2)= 0.8*0.2=0.16

P( Contract 1 and not 2)=0.8*0.8=0.64

P( Contract 2 only)= 0.2*0.7 = 0.14

P( Neither of the contracts) =0.2*0.3=0.06

b) -P(Both the contracts is calculates as 0.16

c) P(First contract/Second contract) = 0.16 /[0.16+0.14]=16/30=0.5333

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