A Medical Test Has Been Designed to Detect the Presence

question 93

Multiple Choice

A medical test has been designed to detect the presence of a certain disease. Among those who have the disease, the probability that the disease will be detected by the test is 0.91. However, the probability that the test will erroneously indicate the presence of the disease in those who do not actually have it is 0.02. It is estimated that 2% of the population who take this test have the disease. If an individual takes the test twice and both times the test is positive, what is the probability that the person actually has the disease?

• A) 0.481
• B) 0.980
• C) 0.023
• D) 0.519
• E) 0.977

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Definitions:

Consumption Sector

Part of the economy that involves the purchase of goods and services by individuals and households.

Real Interest Rate

The interest rate adjusted for inflation, reflecting the true cost of borrowing or the true yield on an investment.

Nominal Rate

The interest rate before adjustments for inflation, as opposed to the real rate, which is adjusted for the effects of inflation.

Expected Rate

The anticipated yield or return on an investment during a specific period, often estimated based on historical data and future projections.