Suppose That Events A1, A2, and A3 Form a Partition

question 162

Multiple Choice

Suppose that events A1, A2, and A3 form a partition of the sample space S with P(A1) = 0.25, P(A2) = 0.4, andP(A3) = 0.35. If B is an event that is a subset of S and P(B A1) = 0.15, P(B A2) = 0.15, and P(B A3) = 0.21, findP(B) . Round to the nearest ten-thousandth when necessary.

• A) 0.171
• B) 0.0375
• C) 0.1683
• D) 0.0975

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Definitions:

Equity Securities

Financial instruments representing ownership interest in a company, such as stocks.

Debt Securities

Financial instruments representing a loan made by an investor to a borrower, typically involving periodic interest payments and the return of principal at maturity.

Held-to-maturity Securities

These are financial assets that a company has the intent and ability to hold until they mature.

Amortized Cost

The expense of an intangible asset over its useful life.