The probability of p(placebo and improvement) is 7.6%.
Participants in a study of a new medication received either medication A or a placebo.
The probability of P(placebo and improvement).
Participants in a study of a new medication received either medication A or a placebo.
Let Probability that participants received medication A = P(M) = 0.80
Probability that participants received placebo = P(P) = 1 - P(M) = 1 - 0.80 = 0.20.
Because there are only two cases either medication A or a placebo.
Let I = event that there is an improvement.
Also, the Probability that participants reported improvement given that they had received medication A = P(I/M) = 0.76
The probability that participants reported no improvement given that they had received placebo = P(I'/P) = 0.62
So, Probability that participants reported improvement given that they had received placebo is,
= P(I / P) = 1 - P(I' / P) = 1 - 0.62 = 0.38
Now, Probability of (placebo and improvement) = Probability that participants received placebo times Probability that participants reported improvement given that they had received placebo.
P(placebo and improvement) = P(P) times P(I / P)
P(placebo and improvement) = 0.20 times 0.38 = 0.076 or 7.6%
Therefore, the required probability of p(placebo and improvement) is 7.6%.
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