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A feature-length film is considered to be a blockbuster in the United States if its domestic box office receipts exceed $100,000,000. One of the most successful studios in producing blockbuster films is Walt Disney Studios. The probability that any feature film produced becomes a blockbuster is 1.2%. Disney Studios releases 3% of US feature length films. For all other studios (i.e., not Disney), the probability that a film become a blockbuster is 1%.
Problem a. Build a 2 × 2 contingency table which includes all joint and marginal probabilities that feature-length films are (1) released by Disney Studios and (2) become blockbusters. Using the information from the contingency table, estimate the probability that a film becomes a blockbuster if it was released by Disney Studios.
Problem b. If Disney Studios releases 20 films next year, what is the probability that the studio will have multiple (i.e., more than one) blockbusters?
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