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Jim MacFarlane owns shares of stock in both Evergreen Company and Daylight Company. Jim has recorded the performance of these shares on each day for

Jim MacFarlane owns shares of stock in both Evergreen Company and Daylight Company. Jim has

recorded the performance of these shares on each day for a 300 day period, observing whether the

price of these shares has risen, fallen or remain unchanged. Assume the 300 day period is a good

indication of the future, so we can use this data to determine probabilities of these events occurring

again. Jim's data is as follows:

Event

Evergreen

Company

Daylight

Company # of days

E1 Rise Rise 70

E2 Rise Unchanged 40

E3 Rise Fall 28

E4 Unchanged Rise 30

E5 Unchanged Unchanged 18

E6 Unchanged Fall 20

E7 Fall Rise 28

E8 Fall Unchanged 16

E9 Fall Fall 50

Define the following additional events:

Let event A = rise in Evergreen Company

event B = fall in Daylight Company

event C = unchanged price in Evergreen Company

event D = unchanged price in Daylight Company

In all questions below, you must determine the probabilities using the numbers in the table above to

show the calculations that support your answers. Probability formulas are required in all questions

except part (g) below.

(a) A rise in the price of Evergreen

Page 2

(b) A fall in the price of Daylight stock

(c) A rise in Evergreen and a fall in Daylight stock

(d) A rise in Evergreen or a fall in Daylight stock

(e) Which stock has a higher probability of having its stock price rise? What is that probability?

(f) That Evergreen stock will rise or remain unchanged

(g) That Evergreen stock price will rise and Daylight stock will remain unchanged

(h) That Evergreen stock will rise or Daylight Company stock will remain unchanged

(i) Are the two events "a rise in Evergreen stock" and "a fall in Daylight stock" independent?

Provide evidence.

Can you please solve this for me ?

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