SOLUTION: (CO 2) Consider the table below. Profit Loss Total Urban location 50 38 88 Rural location 61 94 155 Total 111 132 243 Find the probability that a randomly selected lo

Question 1196221: (CO 2) Consider the table below.
Profit Loss Total
Urban location 50 38 88
Rural location 61 94 155
Total 111 132 243

Find the probability that a randomly selected location is in an urban location, given that it is operating a loss.
Group of answer choices
55.0%
48.8%
36.2%
28.8%
Answer by greenestamps(13215) (Show Source): You can put this solution on YOUR website!

Conditional probability: find the probability that a particular location is an urban one, GIVEN THAT it is operating at a loss.

Informally, the "given that" means the denominator of the probability fraction is only the number of locations that are operating at a loss: 132

The numerator of the probability fraction is the number of locations that are operating at a loss and are also rural: 38

The probability is then 38/132, which is approximately 28.8%.

ANSWER: 28.8%

Formally, the conditional probability is

   P(operating at a loss AND urban)     (38/243)
  ---------------------------------- = ---------- = 38/132
        P(operating at a loss)          (132/243)

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