Compute Conditional Probabilities
-The Manager of a Used Car Lot $\frac { 11 } { 20 }$

question 158

Multiple Choice

Compute Conditional Probabilities
-The manager of a used car lot took inventory of the automobiles on his lot and constructed the following table based on the age of his car and its make (foreign or domestic) . A car was randomly selected from the lot. Given that the car selected was a domestic car, what is the probability that it was older than 2 years?

• A) \(\frac { 11 } { 20 }\)
• B) \(\frac { 15 } { 29 }\)
• C) \(\frac { 9 } { 40 }\)
• D) \(\frac { 87 } { 200 }\)

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Definitions:

Opportunity Loss Table

A table used in decision analysis that quantifies the difference between the payoff from the best action and all other actions for each state of nature.

Payoff Table

A decision-making tool used in statistics and business to show the expected outcomes of different decisions under various states of nature.

Decision Matrix

A tool used in decision-making to evaluate and prioritize a list of alternatives or options, based on a set of criteria.

Payback Period Matrix

A conceptual tool used in finance to evaluate the time required for an investment to return its initial cost, considering various scenarios or criteria.