The probability that interest rates on housing loans will go up in the next
6 months is estimated to be 0.20. The probability that house sales will
decrease is estimated to be 0.6. The probability that interest rates will go
up and house sales will decrease is estimated to be 0.15.
1) The probability that interest rates increase and house sales decrease
2) The probability of an increase in interest rates and not a decrease in
house sales
3) The probability of a decrease in house sales and not an increase in
interest rates
4) The probability of not an increase in interest rates and not a decrease
in house sales
5) The probability that house sales will go down given that interest rates
will go up
P(A) = 0.2
P(B) = 0.6
P(A∩B) = 0.15
1) P(A∩B) = 0.15
HOUSES
SALE
TOTAL
INTEREST RATE
INCREASE DECREASE
INCREASE
0.05
0.35
DECREASE
0.15
0.45
0.2
0.8
5) P(B/A)= P(A∩B) / P(A) = 0.15 / 0.2 = 0.75
TOTAL
0.4
0.6
1