In a Local Cellular Phone Area, Company a Accounts for 60

question 81

Multiple Choice

In a local cellular phone area, company A accounts for 60% of the cellular phone market, while company B accounts for the remaining 40% of the market. Of the cellular calls made with company
A, 1% of the calls will have some sort of interference, while 2% of the cellular calls with company B
Will have interference. If a cellular call is selected at random and has interference, what is the
Probability that it was with company A?

• A) 0.071
• B) 0.429
• C) 0.571
• D) It cannot be determined.

---

Definitions:

Average Cost Curve

A graph that illustrates the cost per unit of output by dividing the total cost by the quantity of output produced, typically showing how costs fluctuate with changes in scale.

Marginal Cost Curve

A graph that shows the increase in cost incurred by producing one more unit of a good or service.

U-Shaped

Characterizes graphs or functions that have a visible dip in the middle, creating a shape similar to the letter "U," often found in economic analyses representing cost curves.

Cost Function

A mathematical description of how production costs vary with changes in the quantity of output produced.