Suppose that 1% of the employees of a certain company use illegal drugs. This company performs random drug tests that return positive results 99% of the time if the person is a drug use. However, it also has a 2% false positive rate. The results of the drug test are known to be independent from test to test for a given person.
(a) Steve, an employee of the company, has a positive test. What is the probability that he is a drug user?
(b) Knowing he failed his first test, what is the probability that Steve will fail his next drug test?
(c) Steve just failed his second test. Now what is the probability that he is a drug user?