Question: Compute probabilities for the following compound events:
Ms. Jones, a bookstore owner, wishes to send out an advertisement to potential customers. She estimates that 20 percent of the town's residents are recreational readers, and she knows that all of the residents are either recreational readers or TV addicts (but not both). Also, a media expert has told her that two of ten TV addicts are newspaper subscribers, and from a survey of her own customers she has learned that seven of ten recreational readers are newspaper subscribers. If Ms. Jones places an ad in the local newspaper, how effective will the ad be? (That is, what is the probability that a newspaper subscriber is a recreational reader?)