The description and statements given in Problem 7.24 often elicit responses that are not consistent with probability

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The description and statements given in Problem 7.24 often elicit responses that are not consistent with probability requirements. If you are like most people, you ranked statement h (Linda is a bank teller and is active in the feminist movement) as more probable than statement f (Linda is a bank teller).

a. Explain why you ranked statements h and f as you did.

b. Statement h is actually a compound event. That is, for h to be true, Linda must be both a bank teller (Outcome A) and active in the feminist movement (Outcome B). Thus, statement h is represented by the Outcome “ A ” and “ B. ” Use a Venn diagram to explain why statement h must be less probable than statement f.

c. Suppose that you have presented Problem 1 to a friend, who ranks statement h as more probable than statement f. Your friend argues as follows: “Well, it’s not very likely that Linda is a bank teller in the first place. But if she is a bank teller, then she is very likely to be active in the feminist movement. So h would appear to be more likely than f.” How is your friend interpreting statement h? Explain why this is not an appropriate interpretation.

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Making Hard Decisions with decision tools

ISBN: 978-0538797573

3rd edition

Authors: Robert Clemen, Terence Reilly

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