The following table is adapted from an article by Marshall Thomas in the F&W Forestry Letter. The data refer to land and timber values in the South. Sawtimber prices are in dollars per thousand board feet. Bare land prices are in dollars per acre and refer to land that has been cleared of timber. (Give your answers correct to two decimal places.) Sawtimber price 179 Bare land price 299 Year 1990 1994 310 321 | 1996 1998 311 391 395 446 (a) What is the average rate of change per year in sawtimber prices from 1994 to 1996? per thousand board feet per year (b) Calculate an estimate of the sawtimber price in 1995. dollars per thousand board feet (c) What is the average rate of change per year in bare land prices from 1996 to 1998? per acre per year (d) Calculate an estimate of the bare land price in 1997. per acre (e) Is there a difference in the price percentage increases when comparing sawtimber prices and bare land prices from 1990 to 1998? o Yes O No (f) Would it be better to invest in bare land or in sawtimber, based on your answer from part (e)? o bare land O sawtimber o neither, they both have the same growth rate o neither, they both have the same percentage increase in price
Compound Probability
Compound probability can be defined as the probability of the two events which are independent. It can be defined as the multiplication of the probability of two events that are not dependent.
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Probability theory is a branch of mathematics that deals with the subject of probability. Although there are many different concepts of probability, probability theory expresses the definition mathematically through a series of axioms. Usually, these axioms express probability in terms of a probability space, which assigns a measure with values ranging from 0 to 1 to a set of outcomes known as the sample space. An event is a subset of these outcomes that is described.
Conditional Probability
By definition, the term probability is expressed as a part of mathematics where the chance of an event that may either occur or not is evaluated and expressed in numerical terms. The range of the value within which probability can be expressed is between 0 and 1. The higher the chance of an event occurring, the closer is its value to be 1. If the probability of an event is 1, it means that the event will happen under all considered circumstances. Similarly, if the probability is exactly 0, then no matter the situation, the event will never occur.
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