Question: What is the probability of an individual's purchasing the product given that the individual recalls seeing the advertisment? Does seeing the advertisement increase the probability that the individual will purchase the porduct? As a decision maker, would you recommend continuining the advertisement (assuming that the cost is resonable)?
B = individual purchased the product
S = individual recalls seeing the advertisement
B and S = individual purchased the product and recalls seeing the advertisement
P(B) = .20, P(S) = .40, and P(B and S) = .12
My answer: P(.20|.40)/.40 = .20/.40 = .50 .40/.40 = 1 =50%
I believe that seeing advertisement does increase the probability of product purchase.
As a decision maker, based on resonable cost, I would continue the advertisement for a limit time, if sales increase it may run longer, if there is no change then I discontinue the advertisement.
Am I on the right track? Edit
The probability of an individual's purchasing the product given that the individual recalls seeing the advertisement = p(B|S)=P(B and S)/P(S)=0.12/0.40=0.3
2. yes. seeing the advertisement increase the probability that the individual will purchase the porduct.
your decision is right. Edit
TutorTeddy.com & Boston Predictive Analytics
[ Email your Statistics or Math problems to email@example.com (camera phone photos are OK) ]
Boston Office (Near MIT/Kendall 'T'):
Cambridge Innovation Center,
One Broadway, 14th Floor,
Cambridge, MA 02142,
Dallas Office (Near Galleria):
15950 Dallas Parkway,
Dallas, TX 75248,