CFA Practice Question

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CFA Practice Question

Sal has a 60% probability of being Salesman of the Month. He has a 40% probability of getting a raise. Sal has a 10% probability of being Salesman of the Month and getting a raise. What is P(Sal gets Salesman of the Month given he gets the raise)?

A. 25%
B. 30%
C. 16.7% to nearest 0.1%
Correct Answer: A

In a tree diagram, the event Salesman of Month given raise is represented by the top branch of the second set of branches. To find the probability of this branch we use: 0.4x = 0.1. Now, x = 0.1/0.4 = 1/4 = 0.25. Thus, P(Sal gets Salesman of the Month given raise) = 25%.

User Contributed Comments 4

User Comment
fedha P(S)=0.60 P(R)=0.40 P(SR)=0.10 P(S|R)=?
We know P(SR)=P(S|R)*P(R)...
Therefore 0.10 = y * 0.40 solving for y=0.10/0.40
y = 0.25 ~ 25% ...P(S|R) = 0.25
Fotsta P(A/B)=P(AB)/P(B)=0,1/0,4=0,25
2014 Each event is based on the other event.

Practically, applies if u are salesman of the year then only u get raise. So multiply all
idzani That P(S)=60% only serves as a distraction. Didn't really need it in calculation.
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