- CFA Exams
- CFA Exam: Level I 2021
- Study Session 2. Quantitative Methods (1)
- Reading 8. Probability Concepts
- Subject 1. Introduction

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**CFA Practice Question**

The probability that the unemployment rate will increase in January is 0.35. What is the probability that the unemployment rate will not increase in January?

B. 0.35

C. 0.65

A. 0.30

B. 0.35

C. 0.65

Correct Answer: C

The answer is 0.65 because the sum of the probabilities of any set of mutually exclusive and exhaustive events is 1. The probability that the unemployment rate will not increase in January is 1 - the probability that it will increase in January, or 1 - 0.35 = 0.65.

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**User Contributed Comments**
6

User |
Comment |
---|---|

bananabun |
What if it stays the same? |

BonnieG |
.65 encompasses the probability of it staying the same or decreasing (it just says not increasing). |

krisscfa |
0.65=P(Remaining the same) + P( rate not Increasing) |

manrah |
its not matter of remaining say. it just say if i say 2day probability of raining is 35% den wht ll b ur ans for probability of not raining , it ll b 65%. let me knw if u dint understand. |

2014 |
I hope this question comes |

johntan1979 |
Dream on... |