THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION

question 38

Essay

THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION:
A company wishes to evaluate the effectiveness of a marketing campaign.Seventy five percent of all potential professors were reached in a focused advertising program.Twenty eight percent of those contacted adopted the book while 8% of the adoptions came from professors who did not receive the promotional material.Define the following events of interest:
A₁ = Professor received advertising material
A₂ = Professor did not receive advertising material
B₁ = Professor adopts the book
B₂ = Professor does not adopt the book
-What is the probability that a professor does not adopt the book?

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Definitions:

Call Option

A financial contract that gives the holder the right, but not the obligation, to buy a stock, bond, commodity, or other assets at a predetermined price within a set time frame.

Covered Call

An options strategy where an investor holds a long position in an asset and sells call options on that same asset to generate income from the option premiums.

Exchange-Traded Options

Options contracts that are traded on a regulated exchange rather than being dealt with privately between two parties.

OTC Options

Over-the-counter options are trades made directly between two parties, not on a formal exchange, tailored to the parties' requirements.