Question

Anne is choosing a contractor. She has narrowed down her selection to two

companies and will base her decision on the likelihood that the job is done on
time and on budget. She uses online reviews to estimate the probabilities.
Which contractor should Anne choose to maximize the probability that the job will be done on time and on budget? Assume all events are independent.

Answer 1

Answer: A. Contractor A. The probability that both conditions are met is 0.93

Explanation:

Probability of two independent events happening can be found by multiplying them.

Probability of A doing the job on time and on budget:

= Probability that job is done on time * Probability it is done on budget

= 0.97 * 0.96

= 0.93

Probability of B doing the job on time and on budget:

= 0.93 * 0.98

= 0.91

Contractor A has the better probability at 0.93 so should be chosen.