The probability that a new advertising campaign will increase sales is estimated to be 0.80.The probability that the cost of developing the new ad campaign can be kept within the original budget allocation is 0.40.
-Assuming that the two events are independent,the probability that the cost is kept within budget and the campaign will increase sales is
A) 0.88.
B) 0.40.
C) 0.20.
D) 0.32.

Question

Quizplus · Accepted Answer

We can use the multiplication rule for independent events to calculate the probability of both events occurring:

P(cost within budget and increased sales) = P(cost within budget) x P(increased sales)

= 0.40 x 0.80

= 0.32

Therefore, the probability that the cost is kept within budget and the campaign will increase sales is 0.32, which corresponds to option D.

The Probability That a New Advertising Campaign Will Increase Sales