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13. Studying historical time series you nd that 25% of all trading days EA's stock price declines. You also determine that 70% of the price

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13. Studying historical time series you nd that 25% of all trading days EA's stock price declines. You also determine that 70% of the price falls of EA can be associated with a negative news event. If you believe that there is a 50/50 chance that Disney will rescind EA's rights to make Star Wars games, what is your estimated probability of EA suffering a stock decline the trading day after Disney makes such an announcement? A) Cannot be computed with the information provided B) 17.8% C) 25% D] 35% E) 70%

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