Jackson Lu, FRM, participates in a shareholders’ meeting of HITE Inc., a company he follows. In the meeting, the board announces that the company has a probability of 60% to pay dividend if the economy blooms in the next quarter, or a probability of 30% if the economy oscillates continuously. An economist predicts the economy has a probability of 20% to trend upward, and 80% to oscillate. Based on his understanding of the company, what is the probability that the economy actually blooms on the condition that HITE Inc. pays dividend?
Jackson Lu, FRM, participates in a shareholders’ meeting of HITE Inc., a company he follows. In the meeting, the board announces that the company has a probability of 60% to pay dividend if the economy blooms in the next quarter, or a probability of 30% if the economy oscillates continuously. An economist predicts the economy has a probability of 20% to trend upward, and 80% to oscillate. Based on his understanding of the company, what is the probability that the economy actually blooms on the condition that HITE Inc. pays dividend? A.33%.; B.72%.; C.66%.; D.45%