Consider the Probabilities of People Taking HIV Tests

question 35

Multiple Choice

Consider the probabilities of people taking HIV tests. Assume that the true probability of having HIV for all people who take the test is 4%. If HIV tests give a positive result in 99% of the cases in which the person has HIV and give a negative result in 99% of the cases in which the person does not have HIV, what is the probability that a person who gets a positive test result does not have HIV?

• A) 0.125
• B) 0.155
• C) 0.165
• D) 0.195

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Definitions:

Accumulated Depreciation

The aggregate depreciation charges applied to a fixed asset from when it first came into operation.

Commercial Substance

A concept in accounting that occurs when the future cash flows or the economic circumstances of a transaction change as a result of the transaction.

Disposal

The act of getting rid of an asset through sale, trade, abandonment, or other methods, often resulting in the recognition of a gain or loss for accounting purposes.

Book Value

Book value is the net value of a company's assets as recorded on its balance sheet, often contrasted with market or actual value.