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Math Help - Probablity of price increase or decrease

  1. #1
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    Probablity of price increase or decrease

    Let the probability that the FTSE 100 increases today be 0.6 and the probability it goes up tomorrow be 0.7, and the probability that it increases both today and tomorrow be 0.50 Find the probability that it goes down or remains the same both today OR tomorrow.

    So is the question asking for: . P(A' \cap B')=1- . P(A \cap B)=0.50 is this correct?
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  2. #2
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    Quote Originally Posted by charikaar View Post
    Let the probability that the FTSE 100 increases today be 0.6 and the probability it goes up tomorrow be 0.7, and the probability that it increases both today and tomorrow be 0.50 Find the probability that it goes down or remains the same both today OR tomorrow.

    So is the question asking for: . P(A' \cap B')=1- . P(A \cap B)=0.50 is this correct?
    Hmm. If I read your question correctly, we have

    P(A)=.6,

    P(B)=.7, and

    P(A\cap B)=.5.

    And we seek P(A\cup B)=P(A)+P(B)-P(A\cap B)=.8.

    However, your initial statement of the question seems unclear, so maybe that's not what you are asking.
    Last edited by hatsoff; April 9th 2010 at 01:41 PM.
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  3. #3
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    I think you worked out probability of increase today or tomorrow. I want to find the probability of decrease today or tomorrow. thanks for your help.
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  4. #4
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    Quote Originally Posted by charikaar View Post
    I think you worked out probability of increase today or tomorrow. I want to find the probability of decrease today or tomorrow. thanks for your help.
    Ah, okay. Well, then we wish to find P(A'\cup B')=P[(A\cap B)']=1-P(A\cap B)=.5.

    So, yes, you are correct (except for notation).
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