Question
A snack food producer is considering introducing a new product to the consumer market. It can choose to build a new facility for production of
A snack food producer is considering introducing a new product to the consumer market. It can choose to build a new facility for production of the new product, use an existing facility, or outsource the production to another company. The company estimates that the probability of strong demand for this product to be 65% and the probability of weak demand is estimated at 35%. The company also has the option to hire a marketing research firm to conduct a study to provide additional information about the demand that has the following track record: Historically, this research firm has predicted a strong demand when the eventual demand was strong 80% of the time. Historically, this research firm has predicted a weak demand when the eventual demand was weak 85% of the time. Given that the survey predicts a strong demand, the probability that the eventual demand is strong is ________.
Select one:
a.0.776
b.0.855
c.0.817
d.0.908
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