It is estimated 30% of all adults in United States invest in stocks and that 83% of U.S. adults have investments in fixed income instruments (savings accounts, bonds, etc.). It is also estimated that 25% of U.S. adults have investments in both stocks and fixed income instruments.
(a) What is the probability that a randomly chosen U.S. adult invests in stocks, given that s/he invests in fixed income instruments?
(b) What is the probability that a randomly chosen stock investor also invests in fixed income instruments?© BrainMass Inc. brainmass.com June 3, 2020, 11:49 pm ad1c9bdddf
Recall that to calculate conditional probability, we simply need to use ...
The full solution includes details on how to apply Bayes Law to solve these problems.