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Get access to the detailed solutions to the previous year's questions asked in XAT exam.
Results have been favourable 70% of times and success rate of products favourably tested was 80%.
Further, when test marketing results were unfavourable i.e. 30 %; the products have been successful 30% of the times.
The probability of product failure if Reddy and Rao decide to test market it= 7/10 x 2/10 + 3/10 x 7/10=35/100 =0.35