Question
Johnson Chemicals is considering two options for its supplier portfolio. Option 1 uses two local suppliers. Each has a unique-event risk of 5.4%, and the
Johnson Chemicals is considering two options for its supplier portfolio. Option 1 uses two local suppliers. Each has a "unique-event" risk of
5.4%,
and the probability of a "super-event" that would disable both at the same time is estimated to be
1.6%.
Option 2 uses two suppliers located in different countries. Each has a "unique-event" risk of 14%,
and the probability of a "super-event" that would disable both at the same time is estimated to be
0.24%.
a) The probability that both suppliers will be disrupted using option 1 is??
nothing
(round your response to five decimal places).
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