Question

An analysis of personal loans at a local bank revealed the following facts: 10% of all personal loans are in default (D), 90% of all personal loans are not in default (D΄), 20% of those in default are homeowners (H | D), and 70% of those not in default are homeowners (H | D΄). If a personal loan is selected at random, P (D | H)

Answer 1

Answer:

An analysis of personal loans at a local bank revealed the following facts: 10% of all personal loans are in default (D), 90% of all personal loans are not in default (D'), 20% of those in default are homeowners (H | D), and 70% of those not in default are homeowners (H | D'). If a personal loan is selected at random

P

(

H

∩

D

′

)

= _____ (

∩

means 'AND' or joint).

a 0.20

b 0.63

c 0.90

d 0.18

e 0.78

Explain.