Ask Microeconomics Expert

1. Nate (similar to Freddy, who was discussed in class) is trying to decide whether Kimayais a nice person. There is an equal chance that Kimaya is mean, average, or nice.Whenever a person meets Kimaya, she acts either pleasantly or unpleasantly. If Kimayais mean, she will act pleasantly one-quarter of the time; if she is average, she will actpleasantly one-half of the time; and if she is nice, she will act pleasantly three-quartersof the time (everyone has their bad days). In reality, Kimaya's behavior is independentover time. But Nate believes in the law of small numbers, and has N = 24.

(a) Suppose Nate meets Kimaya four times, and she is pleasant each time. This partasks you to calculate the correct conclusions Nate should draw from this.

i. Calculate the true probability that Kimaya is pleasant four times in a row ifshe is mean.

Hint: If they meet only once, what is the true probability that Kimaya ispleasant that time if she is mean? If they meet twice, what is the trueprobability that she is mean both times if she is mean? If they meet threetimes, what is the true probability that she is mean all three times?

ii. Calculate the true probability that Kimaya is pleasant four times in a row ifshe is average.

iii. Calculate the true probability that Kimaya is pleasant four times in a row ifshe is nice.

iv. Based on the answers to the previous parts, calculate the overall probabilitythat Kimaya is pleasant four times in a row.

v. Apply Bayes' rule and calculate the probability that Kimaya is nice conditionalon the fact that she was pleasant four times in a row. That is to say,if Nate has seen Kimaya be pleasant all four times, what is the probability that she is truly nice?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91528688
  • Price:- $30

Guranteed 24 Hours Delivery, In Price:- $30

Have any Question?


Related Questions in Microeconomics

Question show the market for cigarettes in equilibrium

Question: Show the market for cigarettes in equilibrium, assuming that there are no laws banning smoking in public. Label the equilibrium private market price and quantity as Pm and Qm. Add whatever is needed to the mode ...

Question recycling is a relatively inexpensive solution to

Question: Recycling is a relatively inexpensive solution to much of the environmental contamination from plastics, glass, and other waste materials. Is it a sound policy to make it mandatory for everybody to recycle? The ...

Question consider two ways of protecting elephants from

Question: Consider two ways of protecting elephants from poachers in African countries. In one approach, the government sets up enormous national parks that have sufficient habitat for elephants to thrive and forbids all ...

Question suppose you want to put a dollar value on the

Question: Suppose you want to put a dollar value on the external costs of carbon emissions from a power plant. What information or data would you obtain to measure the external [not social] cost? The response must be typ ...

Question in the tradeoff between economic output and

Question: In the tradeoff between economic output and environmental protection, what do the combinations on the protection possibility curve represent? The response must be typed, single spaced, must be in times new roma ...

Question consider the case of global environmental problems

Question: Consider the case of global environmental problems that spill across international borders as a prisoner's dilemma of the sort studied in Monopolistic Competition and Oligopoly. Say that there are two countries ...

Question consider two approaches to reducing emissions of

Question: Consider two approaches to reducing emissions of CO2 into the environment from manufacturing industries in the United States. In the first approach, the U.S. government makes it a policy to use only predetermin ...

Question the state of colorado requires oil and gas

Question: The state of Colorado requires oil and gas companies who use fracking techniques to return the land to its original condition after the oil and gas extractions. Table 12.9 shows the total cost and total benefit ...

Question suppose a city releases 16 million gallons of raw

Question: Suppose a city releases 16 million gallons of raw sewage into a nearby lake. Table shows the total costs of cleaning up the sewage to different levels, together with the total benefits of doing so. (Benefits in ...

Question four firms called elm maple oak and cherry produce

Question: Four firms called Elm, Maple, Oak, and Cherry, produce wooden chairs. However, they also produce a great deal of garbage (a mixture of glue, varnish, sandpaper, and wood scraps). The first row of Table 12.6 sho ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As