a) The analysts’ stock recommendations are of considerable interest to investors. A study looking at the subsequent performance of new buy and sell recommendations by analysts over a period of time found the following results: Successful Unsuccessful New Buy 957 1233 New Sell 503 221 Note: A buy recommendation is ‘successful’ if the stock outperforms the benchmark by at least 4% over the next year. A sell recommendation is ‘successful’ if the stock underperforms the benchmark by at least 2% over the next year. (iii) What is the probability that a chosen recommendation is either a new buy or successful?

A First Course in Probability (10th Edition)
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a) The analysts’ stock recommendations are of considerable interest to investors. A study looking at the subsequent performance of new buy and sell recommendations by analysts over a period of time found the following results:
Successful Unsuccessful
New Buy 957 1233
New Sell 503 221
Note: A buy recommendation is ‘successful’ if the stock outperforms the benchmark by at least 4% over the next year. A sell recommendation is ‘successful’ if the stock underperforms the benchmark by at least 2% over the next year.

(iii) What is the probability that a chosen recommendation is either a new buy or successful?

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