Aconsulting firm submitted a bid for a large research project. the firm’s management
initially felt they had a 50–50 chance of getting the project. however, the agency to which
the bid was submitted subsequently requested additional information on the bid. past
experience indicates that for 75% of the successful bids and 40% of the unsuccessful bids
the agency requested additional information.
a. what is the prior probability of the bid being successful (that is, prior to the request
for additional information)?
b. what is the conditional probability of a request for additional information given that
the bid will ultimately be successful?
c. compute the posterior probability that the bid will be successful given a request for
additional information.

10. problems and applications q10 a market is described by the following supply-and-demand curves: qsqs = = 2p2p qdqd = = 300â’p300â’p the equilibrium price is $ and the equilibrium quantity is . suppose the government imposes a price ceiling of $90. this price ceiling is , and the market price will be $ . the quantity supplied will be , and the quantity demanded will be . therefore, a price ceiling of $90 will result in . suppose the government imposes a price floor of $90. this price floor is , and the market price will be $ . the quantity supplied will be and the quantity demanded will be . therefore, a price floor of $90 will result in . instead of a price control, the government levies a tax on producers of $30. as a result, the new supply curve is: qsqs = = 2(pâ’30)2pâ’30 with this tax, the market price will be $ , the quantity supplied will be , and the quantity demanded will be . the passage of such tax will result in .