Refer to Part B of Table 2.3 for the conditional distribution of the number of network failures

Question:

Refer to Part B of Table 2.3 for the conditional distribution of the number of network failures \(M\) given network age \(A\). Let \(\operatorname{Pr}(A=0)=0.5\); that is, you work in your room \(50 \%\) of the time.

a. Compute the probability of three network failures, \(\operatorname{Pr}(M=3)\).

b. Use Bayes' rule to compute \(\operatorname{Pr}(A=0 \mid M=3)\).

c. Now suppose you work in your room one-fourth of the time, so \(\operatorname{Pr}(A=0)=0.25\). Use Bayes' rule to compute \(\operatorname{Pr}(A=0 \mid M=3)\).

Table 2.3

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Introduction To Econometrics

ISBN: 9780134461991

4th Edition

Authors: James Stock, Mark Watson

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