Answer: 0.28

## Explanation Let: - **A** be the event that the dividend is increased - **B** be the event that the share price increases Given: - P(A) = 0.4 (probability of dividend increase) - P(B | A) = 0.7 (probability of share price increase given dividend increase) The joint probability of an increase in dividends and an increase in share price is P(B ∩ A). Using the multiplication rule of probability: $$ P(B|A) = \frac{P(B \cap A)}{P(A)} $$ Rearranging the formula: $$ P(B \cap A) = P(B|A) \times P(A) = 0.7 \times 0.4 = 0.28 \text{ or } 28\% $$ **Note:** P(A ∩ B) = P(B ∩ A) since the intersection of events is commutative. Therefore, the joint probability of both events occurring is **0.28**.

Author: Tanishq Prabhu