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Basic Question 2 of 3
In a certain electric motor factory, production lines 1, 2, and 3 produce 10%, 40%, and 50%, respectively, of the total output. Of their respective outputs, 5%, 3%, and 1% are defective. What is the probability that a defective motor came from production line 2?
B. 0.0340
C. 0.5455
A. 0.0220
B. 0.0340
C. 0.5455
User Contributed Comments 9
| User | Comment |
|---|---|
| azramirza | Or .05*.10=0.0050 .03*0.40=0.0120 .01*.50=0.0150 total=0.0220 Machine2to be defective=0.0120/0.220=0.0545 |
| EminYus | How come there is no multiplication of the event in the above example? I got the answer, but don't understand how it relates to Bayes. P(E | I) = P(I |E) / P(I) x P(E) |
| EminYus | nevermind, broke it all down and figured it out |
| harpalani | Forget what Bayes said. Let's look at it this way: Prd Line % Prod. % default Prob. of default 1 10% 5% 0.005 2 40% 3% 0.012 3 50% 1% 0.005 Prob. tht defective production came from prod line 2 = 0.012/(0.005+0.012+0.005) = 54.45% |
| NikolaZ | Bayes formula took forever, I assumed 100 motors, out of 100: 2.2 were defective, out of these 2.2, 1.2 of the defects belonged to Production(2) Therefore: 1.2/2.2 = 0.5455 |
| bidisha | How can i change the settings in my ba2 plus professional so that it will go up to 3 decimal places rather than rounding everything down auto to 2 decimal?? |
| Seancfa1 | Read the manual! 2nd format choose amount of d.p enter 2nd quit |
| thebkr7 | @Harpalani. Perfectly explained Thanks |
| cfastudypl | Well done Harpalani, I agree with you, because following the basic way of computing for probability will yield the same result. |
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Learning Outcome Statements
calculate and interpret an updated probability in an investment setting using Bayes' formula
CFA® 2025 Level I Curriculum, Volume 1, Module 4.