If the Probability of Event a Is

question 133

Multiple Choice

If the probability of event A is .40 and the probability of event B is .35,what is the probability that event A or B will occur,if A and B are independent?

• A).14
• B).61
• C).75
• D)cannot be determined

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Definitions:

Pure Time Value

The portion of an option's price that reflects the potential for value change based on the time remaining until its expiration.

Market Risk Premium

The bonus yield an investor projects to receive by placing their money in a risky market portfolio instead of in assets that carry no risk.

Market Rate

The prevailing interest rate available in the marketplace.

Individual Security

A particular financial instrument such as a stock or bond representing an ownership or creditor relationship with a corporation or governmental entity.