Illustration 16.60. A bank has a test designed to establish the credit rating of a loan applicant. If the persons, who default (D), 90% fail the test (F). Of the persons, who will repay the bank (ND), 5% fail the test. Furthermore, it is given that 4% of the population is not worthy of ¢redit ; i.e., P(D) = .04. Given that someone failed the test, what is the probability that he actually will default (when given a load)?

MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
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Chapter1: Starting With Matlab
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Illustration 16.60. A bank has a test designed to establish the credit
rating of a loan applicant. If the persons, who default (D), 90% fail the
test (F). Of the persons, who will repay the bank (ND), 5% fail the
test. Furthermore, it is given that 4% of the population is not worthy of
credit ; i.e., P(D) = .04. Given that someone failed the test, what is the
probability that he actually will default (when given a load)?
CS Scanned with CamScanner
Transcribed Image Text:Illustration 16.60. A bank has a test designed to establish the credit rating of a loan applicant. If the persons, who default (D), 90% fail the test (F). Of the persons, who will repay the bank (ND), 5% fail the test. Furthermore, it is given that 4% of the population is not worthy of credit ; i.e., P(D) = .04. Given that someone failed the test, what is the probability that he actually will default (when given a load)? CS Scanned with CamScanner
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