Q.Two groups are competing for the position on the Board of directors of a corporation. The probabilities that the first and the second groups will win are and respectively. Further, if the first group wins, the probability of introducing a new product is and the corresponding probability is if the second group wins. Find the probability that the new product introduced was by the second group.
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Start your 14-day free trial to unlock the full solution →This is a classic Bayes’ theorem problem: we are given the prior probabilities of each group winning and the conditional probabilities of introducing a new product given the winner. The question asks for the reverse conditional probability — that the second group introduced the product, given that a new product was introduced. The answer is .
We start with the idea of conditional probability. The problem gives us probabilities in one direction (win → product launch) but asks for the probability in the opposite direction (product launch → which group won). That’s exactly what Bayes’ theorem is built for.
Let’s define the events clearly:
- Let = event that the first group wins.
- Let = event that the second group wins.
- Let = event that a new product is introduced.
We are told:
- ,
We need — the probability that the second group introduced the product, given that a new product was introduced.
- Find the total probability of introducing a new product. The new product can be introduced either when the first group wins or when the second group wins. These are mutually exclusive and exhaustive events. So by the law of total probability:
Substitute:
-
Apply Bayes’ theorem.
Bayes’ theorem says:
…
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