# A consulting firm submitted a bid for a large research project. The firm’s management initially felt they had a 50–50 chance of getting the project. However, the agency to which the bid was submitted subsequently requested additional information on the bid. Past experience indicates that for 75% of the successful bids and 40% of the unsuccessful bids the agency requested additional information. a. What is the prior probability of the bid being successful (that is, prior to the request for additional information)? b. What is the conditional probability of a request for additional information given that the bid will ultimately be successful? c. Compute the posterior probability that the bid will be successful given a request for additional information.

13th Edition
Anderson
Publisher: CENGAGE L
ISBN: 9781305881884

#### Solutions

Chapter
Section

13th Edition
Anderson
Publisher: CENGAGE L
ISBN: 9781305881884
Chapter 4.5, Problem 41E
Textbook Problem
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## A consulting firm submitted a bid for a large research project. The firm’s management initially felt they had a 50–50 chance of getting the project. However, the agency to which the bid was submitted subsequently requested additional information on the bid. Past experience indicates that for 75% of the successful bids and 40% of the unsuccessful bids the agency requested additional information. a. What is the prior probability of the bid being successful (that is, prior to the request for additional information)? b. What is the conditional probability of a request for additional information given that the bid will ultimately be successful? c. Compute the posterior probability that the bid will be successful given a request for additional information.

a.

To determine

Compute the probability of the bid being successful.

### Explanation of Solution

The given information is that there is a 50-50 chance of getting the project. From the past experience, 75% of the successful bids and 40% of the unsuccessful bids the agency requested additional information...

b.

To determine

Compute the probability for conditional probability of request for additional information given that the bid will ultimately be successful.

c.

To determine

Compute posterior probability that the bid will be successful given a request for additional information.

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