Let's define the following events:
A: Dealer is using the fair coin.
B: Dealer is using the biased coin.
O: We observe the sequence H, H, H.
We want to calculate the probability of event B given O, i.e., P(B|O).
By Bayes' theorem, we have: P(B|O) = P(O|B) * P(B) / P(O)
P(O|B) = 1
P(B) = 0.5
P(O) = P(O|A)*P(A) + P(O|B)*P(B)
We need to calculate P(O|A) and P(O|B):
P(O|A) = P(H, H, H|A) = P(H|A)^3 = 0.5^3 = 0.125
P(O|B) = P(H, H, H|B) = 1
P(O) = P(O|A)*P(A) + P(O|B)*P(B) = 0.125 * 0.5 + 1 * 0.5 = 0.5625
Now we can use these values for the Bayes theorem:
P(B|O) = P(O|B) * P(B) / P(O) = 1 * 0.5 / 0.5625 = 0.8889