SOLUTION: Credit derivatives are a new kind of investment instrument. if such an investment offeres be ABN Amro has a 90% chance of making money , another by AXA has a 75% chance of success,
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Question 1136552: Credit derivatives are a new kind of investment instrument. if such an investment offeres be ABN Amro has a 90% chance of making money , another by AXA has a 75% chance of success, and one by theING Group has a 60% chance of being profitable, and the three are independent of each other, what is the chance that at least one investment will make money? Thank you so much for your help. Answer by Theo(13342) (Show Source):
You can put this solution on YOUR website! the probability that at least one is successful is equal to the 1 minus the probability that none are successful.
the probability that none are successful is equal to (1 - .9) * (1 - .75) * (1 - .60) = .1 * .25 * .4 = .01
the probability that at least one will be successful is therefore 1 - .01 = .99.
i used excel to detail all the possible probabilities.
