Using Probability to Analyze Decisions and Strategies: Mastery Test

Select the correct answer.

Jason inherited a piece of land from his great-uncle. Owners in the area claim that there is a [tex]\( 45\% \)[/tex] chance that the land has oil. Jason decides to test the land for oil. He buys a kit that claims to have an [tex]\( 80\% \)[/tex] accuracy rate of indicating oil in the soil. What is the probability that the land has no oil and the test shows that there is no oil?

A. 0.09
B. 0.11
C. 0.44
D. 0.36



Answer :

To solve this problem, let's break it down step by step:

1. Identify the given probabilities:
- The probability that the land has oil: [tex]\( P(\text{Oil}) = 0.45 \)[/tex]
- The accuracy of the test kit is [tex]\( 80\% \)[/tex], which means:
- It correctly identifies oil when there is oil: [tex]\( P(\text{Test positive} \mid \text{Oil}) = 0.80 \)[/tex]
- It correctly identifies no oil when there is no oil: [tex]\( P(\text{Test negative} \mid \text{No oil}) = 0.80 \)[/tex]

2. Calculate the probability that the land has no oil:
[tex]\[ P(\text{No oil}) = 1 - P(\text{Oil}) = 1 - 0.45 = 0.55 \][/tex]

3. Determine the probability that the test shows no oil given that there is no oil:
- The accuracy for correctly identifying no oil is [tex]\( P(\text{Test negative} \mid \text{No oil}) = 0.80 \)[/tex]

4. Calculate the joint probability that the land has no oil and the test shows no oil:
[tex]\[ P(\text{No oil and Test negative}) = P(\text{No oil}) \times P(\text{Test negative} \mid \text{No oil}) \][/tex]
[tex]\[ P(\text{No oil and Test negative}) = 0.55 \times 0.80 \][/tex]
[tex]\[ P(\text{No oil and Test negative}) = 0.44 \][/tex]

Thus, the probability that the land has no oil and the test shows no oil is [tex]\( 0.44 \)[/tex].

The correct answer is:
C. 0.44