Use Bayes' Theorem to Find the Indicated Probability

question 152

Multiple Choice

Use Bayes' theorem to find the indicated probability.
-3.8% of a population are infected with a certain disease. There is a test for the disease, however the test is not completely accurate. 93.9% of those who have the disease test positive. However 4.1% of those who do not have
The disease also test positive (false positives) . A person is randomly selected and tested for the disease. What is
The probability that the person has the disease given that the test result is positive?

• A) 0.038
• B) 0.475
• C) 0.525
• D) 0.905

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Definitions:

Avoid Paying

Strategies or actions taken to minimize or evade expenses, taxes, or other financial obligations.

Luxury Tax

A tax imposed on expensive goods and services, often considered non-essential, as a means of raising government revenues without placing the burden on essential items.

Tax Incidence

The distribution of the economic burden of a tax between buyers and sellers, depending on the elasticity of demand and supply.

Net Profits

The actual profit after working expenses not included in the calculation of gross profit have been paid.