Question

An investment consultant predicts that the odds against the price of a certain stock will go up during the next week are 2:1 and the odds in favour of the price remaining the same are 1:3. What is the probability that the price of the stock will go down during the next week?

31 Jul 2024
Answer :
Word Count : 454

To solve this problem, we need to first understand how odds translate into probabilities and then use the information given to find the required probability.

### Step 1: Understanding the odds

The term "odds against" means the ratio of the number of unfavorable outcomes to favorable outcomes. In this case, the odds against the price of the stock going up are 2:1. This means for every 2 unfavorable outcomes (stock price not going up), there ________ _________ _______ _______ ______.
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