SOLUTION: The odds of losing money on a particular stock is 8 to 2. What is the probability that money will be lost on the stock? Show your work...

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Question 1102549: The odds of losing money on a particular stock is 8 to 2. What is the probability that money will be lost on the stock? Show your work...
Answer by Edwin McCravy(20086)   (Show Source): You can put this solution on YOUR website!
The odds of losing money on a particular stock is 8 to 2.
That means that on the average, that for every 8 times you lose 
money on a stock, there are 2 times when you earn money or break
even on a stock.

Therefore on the average, out of every 10 times when you invest 
in a stock, you lose money 8 of those times and you earn money or
break even on 2 of those times.

So the probability of losing money is 8 times out of 10, or 8/10
which reduces to 4/5.

Edwin

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