Answer:
a) P(x) = 0.67
b) P(y) = 0.67
c) P(x=4) = 0.3325
d) P( x = 0 ) = 0.0039
e) The fact that the rise and fall of the stock market relies on market sentiments violates independence used in Binomial distribution and the years are independent
Step-by-step explanation:
A) The probability that the stock market will rise next year = P(x) = 0.67
assuming next year to be X
B) Probability that the stock market will rise the year after next year
= P(y) = 0.67 and this is because the probability is independent of that of the previous years
C) Probability that the stock market will rise in four of the next five years
= P(x=4) = 0.3325
D) probability that the stock market will rise in none of the next five years
= P( x = 0 ) = 0.0039
E) The fact that the rise and fall of the stock market relies on market sentiments violates independence used in Binomial distribution and the years are independent
The probability that the stock market will rise next year = P(x) = 0.65.
The probability that the stock market will rise the year after next is p(y) = 0.65.
The probability that the stock market will rise in four of the next five years is 0.00325.
The probability that the stock market will rise in none of the next five years is 0.0039.
Independent events and probability can be defined as those occurrences that are not dependent on any specific event.
Between 1896—when the Dow Jones index was created— and 2012, the index rose in 65% of the years.
Based on this information, and assuming a binomial distribution.
1. What do you think is the probability that the stock market will rise next year?
The probability that the stock market will rise next year = P(x) = 0.65.
2. What do you think is the probability that the stock market will rise the year after next?
The probability that the stock market will rise the year after next is p(y) = 0.65.
3. What do you think is the probability that the stock market will rise in four of the next five years?
[tex]\rm P(x=4) =0.00325[/tex]
The probability that the stock market will rise in four of the next five years is 0.00325.
4. What do you think is the probability that the stock market will rise in none of the next five years?
The probability that the stock market will rise in none of the next five years is 0.0039.
5. What assumption of the binomial distribution might not be valid?
Independent events and probability can be defined as those occurrences that are not dependent on any specific event.
To know more about Probability click the link given below.
https://brainly.com/question/20914550
