Question

Twenty percent of the job applicants at a firm are new on the market. Of those, 40% will remain in their next job at least 5 years. Of those who are not new on the market, 55% will remain in their next job at least 5 years. If a job applicant remains on his or her next job at least 5 years, what is the probability the applicant is new on the job market?

Answer 1

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The probability that a job applicant who stays for 5 or more years in next job is new in job market

= prob that he is new *prob that he stays in job market for 5 years/ prob new * prob stays for next 5 years + prob not new * prob stays for next 5 year

= (.20*.40)/(.20*.40+.80*.55)

= .08/.08+.44

= .08/.52

= .1539

So, prob that a person who stays stays for more than 5 years is new job applicant is 0.1539