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Before making a final decision on the production plan to adopt the bakery's manager decides to contact Professor Leung in the Math Department to conduct
Before making a final decision on the production plan to adopt the bakery's manager decides to contact Professor Leung in the Math Department to conduct a market research survey. The results of the survey will indicate either favourable or unfavourable market conditions for premium breads, In the past when there was low demand, Professor Leung's predictions were favourable 3015 of the time. The professor's predictions have also been unfavourable given high demand 37%) of the time, and favourable given medium demand 43% of the time. Assume prior probabilities of 0.4 and 05 for high and low demand respectively. a. Calculate posterior (revised) probabilities and enter them in the table below. Round answers to 3 decimal places; do not round intermediate results. hote: The first cell of the table represents P(Low | Favourable) The last cell of the table represents P(High | Unfavourable) Low Medium High Favourable UnfavourableLow Medium High Favourable Unfavourable b. Determine the marginal probabilities of favourable and unfavourable predictions. P[ Favourable) P[ Unfavourable]
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