The Manager of a Used Car Lot Took Inventory of the Automobiles

question 10

Multiple Choice

The manager of a used car lot took inventory of the automobiles on his lot and constructed the following tablebased on the age of his car and its make (foreign or domestic) . A car was randomly selected from the lot. Giventhat the car selected was a domestic car, what is the probability that it was older than 2 years? $\begin{array}{l}\text {\quad\quad\quad\quad\quad\quad\quad\quad\quad Age of Car (in years) }\\\begin{array} { r | c c c c | c } \text { Make } & 0 - 2 & 3 - 5 & 6 - 10 & \text { over 10 } & \text { Total } \\\hline \text { Foreign } & 40 & 30 & 10 & 20 & 100 \\\text { Domestic } & 45 & 27 & 11 & 17 & 100 \\\hline \text { Total } & 85 & 57 & 21 & 37 & 200\end{array}\end{array}$

• A) \(\frac { 11 } { 20 }\)
• B) \(\frac { 9 } { 17 }\)
• C) \(\frac { 9 } { 40 }\)
• D) \(\frac { 17 } { 40 }\)

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Definitions:

Passive Asset Allocation

An investment strategy that aims to build a portfolio mimicking a market index's composition, requiring minimal buying and selling.

Proportions

The quantitative relationship between two amounts, showing the number of times one value contains or is contained within the other.

Portfolio Management

The act of making investment decisions to meet specified investment goals for the benefit of the investors.

Active Asset Allocation

Active Asset Allocation is a strategy in which an investor adjusts the proportions of various assets in a portfolio based on current market conditions and forecasts to try to maximize returns.