Three bayes rule problems

Assignment Help Microeconomics

Reference no: EM13842937

HW - THREE BAYES RULE PROBLEMS

1. EYEWITNESS TESTIMONY. A man was struck by a speeding taxi as he crossed the street. Aneyewitness testified the taxi (which did not stop) was blue. The man sued the Blue Cabcompany for his medical expenses. The city has only two cab companies, Blue Cab and GreenCab. Green Cab has 85% of all taxis in the city.At the trial, the man's lawyer showed that the eyewitness is 80% reliable in identifying thecolor of taxis. That is, the eyewitness was able to identify the color of a taxi correctly 80% ofthe time, under conditions similar to those the night of the accident. The lawyer concludesthat it is extremely likely that the man was hit by a Blue Cab taxi.Given the eyewitness's testimony, what is the probability the man was hit by a Blue Cab taxi?

2.MEDICAL TESTS. Medical tests are used to indicate whether a person has a particulardisease.The sensitivity of a test is the probability that a person having the disease will test positive(indicating the person has the disease, i.e., it's the probability the test will pick up the factthat a person has the disease).The specificity of a test is the probability that a person not having the disease will testnegative.A test for a certain disease has been in use for many years. Based on the "track record" ofthis test, its sensitivity is 0.934 and its specificity is 0.968. Finally, in the population, 1 in 500people has the disease.a. What is the probability that a person who tests positive actually has the disease?b. What value would the specificity of the test have to have in order for the probability toexceed 0.5 that a person who tests positive actually has the disease?

Reference no: EM13842937

Questions Cloud

What is the value of the firms equity : What is the PV of operating cash flows over the competitive advantage period? What is the residual value of the firm after the period of competitive advantage? What is the value of the firm's equity?

How can inflation affect a business in the short-term : How can inflation affect a business in the short-term and long-term? Please back up your argument with at least 500 words in your explanation.

Business plan on bar and cafe : business plan on bar and cafe

The state of pennsylvania is considering increasing taxes : The state of Pennsylvania is considering increasing taxes in order to raise funding for a new Punxsutawney Phil theme park. The government is concerned about the deadweight losses that could result from the new "Punxsutawney tax." Currently the two p..

Three bayes rule problems : EYEWITNESS TESTIMONY. A man was struck by a speeding taxi as he crossed the street. Aneyewitness testified the taxi (which did not stop) was blue. The man sued the Blue Cabcompany for his medical expenses. The city has only two cab companies, Blue Ca..

Forthcoming annual enrollment period : The employee manager of a large company would like to estimate the proportion of full-time employees who prefer adopting plan A of two available health care plans in the forthcoming annual enrollment period.

Explain why an anova was used to analyze : Difference in the mean prices between the three stores? What is the p-value? Explain why an ANOVA was used to analyze this problem.

Case - johnson- estate planning to reduce tax liability : ASE - Johnson: Estate Planning to Reduce Tax Liability. "Roth" retirement plans are encountered with increasing frequency among estate planning clients, especially since (beginning in 2010) the availability of Roth "conversions" was extended to hig..

Explain how an economist could use the slope of yield curve : Explain how an economist could use the slope of the yield curve to analyze the probability that a recession will occur and why the spread may matter.

User Account

All Pages