The Value Line Survey, a service for common stock investors, provides its subscribers with upto-date evaluations of
Question:
The Value Line Survey, a service for common stock investors, provides its subscribers with upto-date evaluations of the prospects and risks associated with the purchase of a large number of common stocks. Each stock is ranked 1 (highest)
to 5 (lowest) according to Value Line's estimate of the stock's potential for price appreciation during the next 12 months. Suppose you plan to purchase stock in three electrical utility companies from among seven that possess rankings of 2 for price appreciation. Unknown to you, two of the companies will experience serious difficulties with their nuclear facilities during the coming year. If you randomly select the three companies from among the seven, what is the probability that you select:
a. None of the companies with prospective nuclear difficulties?
b. One of the companies with prospective nuclear difficulties?
c Both of the companies with prospective nuclear difficulties?
Step by Step Answer:
Statistics For Business And Economics
ISBN: 9780130272935
8th Edition
Authors: James T. McClave, Terry Sincich, P. George Benson