Answer:
The probability that an item selected for inspection is classified as defective is 0.01485.
Explanation:
Denote the events as follows:
A₁ = an item produced by the company is defective.
A₂ = an item produced by the company is not defective.
X = an item is classified as defective by the inspector.
Given:
P (X|A₁) = 0.99
P (X|A₂) = 0.005
P (A₁) = 0.01
P (A₂) = 1 - P (A₁) = 1 - 0.01 = 0.99
The law of total probability states that:

Use this law to compute the probability that an item selected for inspection is classified as defective as follows:

Thus, the probability that an item selected for inspection is classified as defective is 0.01485.