Compute At-Least Probabilities -Investing Is a Game of Chance. Suppose There Is a There

question 54

Multiple Choice

Compute At-least Probabilities
-Investing is a game of chance. Suppose there is a 40% chance that a risky stock investment will end up in a total loss of your investment. Because the rewards are so high, you decide to invest in five independent risky stocks. Find the probability that at least one of your five investments becomes a total loss.

• A) 0.9222
• B) 0.259
• C) 0.0518
• D) 0.0102

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Definitions:

Gradual Weakening

A slow reduction in strength, intensity, or power of something, often occurring over time.

Conditioned Response

A learned reaction to a previously neutral stimulus that has been repeatedly presented along with an unconditioned stimulus.

B. F. Skinner

An influential American psychologist known for developing the theory of behaviorism and for his research on operant conditioning.

Operant Conditioning

A learning process in which the probability of a behavior is changed by its consequences, such as rewards or punishments.