Question

classify the following statement as an example of classical probability, empirical probability, or subjective probability. explain your reasoning. an analyst feels that a certain stocks probability of decreasing in price over the next week is 0.59. this is an example of probability, since it deals with a continuous period rather than a fixed number of trials. the stock has an equal chance of increasing or decreasing in price over the next week. the stocks chance of decreasing in price is the same in every week. the stated probability is the relative frequency of the stock price decreasing in past weeks. the stated probability is most likely based on intuition, an educated guess, or an estimate.

Explanation:

Subjective probability is based on personal judgment, intuition, or an educated guess. Here, the analyst's feeling about the stock's probability of decreasing is a personal assessment rather than a calculation from equally - likely outcomes (classical) or relative frequency (empirical).

Answer:

This is an example of subjective probability, since the stated probability is most likely based on intuition, an educated guess, or an estimate.