In a survey of 100 insurance claims, 40 are fire claims (FIRE ), 16 of which are fraudulent (FRAUD). Also, there are a total of 40 fraudulent claims.
a. Construct a contingency table summarizing the claims data. Use the pairs of events FIRE and FIRE, FRAUD and FRAUD.
b. What proportion of the fire claims are fraudulent?
c. Are the events a claim is fraudulent and a claim is a fire claim independent? Use your probability of part b to prove your answer.