Problem

A fire insurance company has high-risk, medium-risk, and low-risk clients, who have, res...

A fire insurance company has high-risk, medium-risk, and low-risk clients, who have, respectively, probabilities .02, .01, and .0025 of filing claims within a given year. The proportions of the numbers of clients in the three categories are .10, .20, and .70, respectively. What proportion of the claims filed each year come from high-risk clients?

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