Assignment:
Question 1. Assume the financing gurus of a weekend investment television program predicted a 50% chance of XYZ stock gaining in January and a 50% chance of gaining in February. Your financial advisor sees this and tells you there is a 100% chance XYZ stock will gain over the 2-month period. Would you continue to use this financial advisor? Explain.
Question 2. Marie claims she can predict the sex of pregnant women's babies. She sees 1,000 women a year, and she always predicts a female. She charges $1,000 for a prediction, and she always predicts a female (although clients do not know that). When she is wrong, she offers a double-your-money back guarantee. Since the chance of having a female is approximately 50%, how can she earn any money?