In January a sales manager estimates that there is only a ‘30% chance’ that the sales of a new product will exceed one million units in the coming year. However, he is then handed the results of a...

In January a sales manager estimates that there is only a ‘30% chance’ that the sales of a new product will exceed one million units in the coming year. However, he is then handed the results of a sales forecast. This suggests that the sales will exceed one million units. The probability that this indication will be given when sales will exceed a million units is 0.8. However, the probability that the forecast will give this indication when sales will not exceed a million units is 0.4. Revise the sales manager’s estimate in the light of the sales forecast.