Math Problem Statement
Market Researchers Inc. has been hired to perform a study to determine if the market for a new product will be good or poor. In similar studies conducted in the past, whenever the market actually was good, the market research study indicated that it would be good 80% of the time. On the other hand, whenever the market actually was poor, the market study incorrectly predicted it would be good 20% of the time. Before the study is performed, it is believed there is a 30% chance the market will be good. When Market Researchers, Inc. performs the study for this product, the results predict the market will be good. Given the results of this study, what is the probability that the market actually will be good?
Solution
Ask a new question for Free
By Image
Drop file here or Click Here to upload
Math Problem Analysis
Mathematical Concepts
Bayesian Probability
Conditional Probability
Statistics
Formulas
Bayes' Theorem: P(G | Sg) = (P(Sg | G) * P(G)) / (P(Sg | G) * P(G) + P(Sg | P) * P(P))
Theorems
Bayes' Theorem
Suitable Grade Level
Grades 11-12, College-level
Related Recommendation
Bayesian Probability in Student Selection for University Team
Calculate Probability Using Bayes' Theorem in Multiple Choice Exams
Conditional Probability: Knowing the Answer Given Correct Response
Bayesian Inference for Prostate Cancer Using PSA Levels
Probability of High Economic Situation Given Indicator Up - Bayes' Theorem