A proposed shopping center will provide strong competition for downtown businesses like L. S. Clothiers. If the shopping center is built, the owner of L. S. Clothiers feels it would be best to relocate.
The shopping center cannot be built unless a zoning change is approved by the town council. The planning board must first make a recommendation, for or against the zoning change, to the council. Let:
A1 = town council approves the zoning change
A2 = town council disapproves the change
Prior Probabilities
Using subjective judgment: P(A1) = .7, P(A2) = .9