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- [Instructor] A company screens job applicants for illegal drug use at a certain stage in their hiring process. The specific test they use has a false positive rate of two percent and a false negative rate of one percent. Suppose that five percent of all their applicants are actually using illegal drugs and we randomly select an applicant. Giving the applicant test positive, what is the probability that they are actually on drugs? So lets work through this together. So first lets make sure we understand what theyre telling us. So there is this drug test for the job applicants and then the test has a false positive rate of two percent. What does that mean? That means that in two percent of the cases, when it should have read negative, that the person didnt do the drugs, it actually read positive. It is a false positive. It should have read negative but it read positive. Another way to think about it. If someone did not do drugs and you take this test, theres a two percent chance
