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From past experience a stockbroker believes that under present economic conditions a customer will invest in​ tax-free bonds with a probability of 0.40.4​, will invest in mutual funds with a probability of 0.40.4​, and will invest in both​ tax-free bonds and mutual funds with a probability of 0.320.32. Complete parts​ (a) and​ (b) below.(a) in either tax-free bonds or mutual funds;
(b) in neither tax-free bonds nor mutual funds.

Answer :

Answer:

a. 0.48

b. 0.52

Step-by-step explanation:

P(Invest in tax free bonds)=P(T)=0.4

P(Invest in mutual funds)=P(M)=0.4

P(Invest in both)=P(T∩M)=0.32

a.

P(Invest in either tax free bonds or mutual funds)=P(T∪M)=?

P(T∪M)=P(T)+P(M)-P(T∩M)

P(T∪M)=0.4+0.4-0.32

P(T∪M)=0.8-0.32

P(T∪M)=0.48

Thus, the probability that Invest in either tax free bonds or mutual funds is 0.48

b.

P(Invest in neither tax free bonds nor mutual funds)=P(T'∩M')=?

P(T'∩M')=1-P(T∪M)

P(T'∩M')=1-0.48

P(T'∩M')=0.52

Thus, the probability that Invest in neither tax free bonds nor mutual funds is 0.52

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