Suppose that 30% of all South African workers have permanent employmen

kolonelyf4

kolonelyf4

Answered question

2021-11-18

Suppose that 30% of all South African workers have permanent employment contracts, while 50% of South African workers have medium-term employment contracts, and the rest have short-term employment contracts. If a worker has a permanent employment contract, the probability is 0.8 that she is a trade union member. Moreover, if a worker has a medium-term employment contract, the probability is 0.4 that she is a trade union member. Finally, if a worker has a short-term employment contract, the probability is 0.2 that she is a trade union member. Using Bayes theorem, the probability that a worker has a permanent contract, given that she is a member of a trade union is . (Note: write your final answers to 3 decimal places).

Answer & Explanation

Provere

Provere

Beginner2021-11-19Added 18 answers

Step 1
(1) Obtain the probability that a worker has a permanent contract, given that she is a member of a trade union.
The probability that a worker has a permanent contract, given that she is a member of a trade union is obtained below as follows:
From the information, given that
Let A1 denote the event of probability that South African workers have permanent employment contracts. That is, P(A1)=0.30.
Let A2 denote the event of probability that South African workers have medium-term employment contracts. That is, P(A2)=0.50.
Let A3 denote the event of probability that South African workers have short term employment contracts That is, P(A3)=0.20(=1(0.30+0.50))
Let B denote the event that she is a trade union member.
Let (BA1) denote the event of probability that worker has a permanent employment contract and she is a trade union member That is, P(BA1)=0.80.
Let (BA2) denote the event of probability that worker has a medium-term employment contract and she is a trade union member. That is, P(BA2)=0.40.
Let (BA3) denote the event of probability that worker has a short-term employment contract and she is a trade union member That is, P(BA3)=0.20.
Step 2
The total probability is calculated as shown below:
P(B)=P(A1)P(BA1)+P(A2)P(BA2)+P(A3)P(BA3)
=(0.30)(0.80)+(0.50)(0.40)+(0.20)(0.20)
=0.24+0.20+0.04
=0.48
The required probability is,
P(A1B)=(0.30)(0.80)0.48
=(0.24)0.48
=0.500
The probability that a worker has a permanent contact, given that she is a member of a trade union is 0.500.

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