How accurate is the claim of the probability of success for Imogen’s Guaranteed Investment Package? In what ways is the claim misleading? How would you calculate and state the probability of having an annual rate of return not less than 15%?
The claim: With Imogen’s Guaranteed Investment Package, you have a 4/5 change of getting annualized rates of return of no less than 15%.
The data on the company’s site to back this up:
| Return not less than 15% | Return less than 15% | |
| Best 10 Customers | 8 | 2 |
| Other Customers | 0 | 19 |
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That’s not all. A survey of 168 Springville-area investors revealed that there was only a 7% probability of being an Imogen investor who lost money! Invested at Imogen and lost money: 11 rnTotal number in survey: 168 rnProbability = 11/168 or about 7%!
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