chapter 4 basic probability. learning objectives in this chapter, you learn: basic probability...
TRANSCRIPT
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Chapter 4
Basic Probability
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Learning Objectives
In this chapter, you learn:
Basic probability concepts and definitions Joint Probability Marginal Probability Conditional probability Additional Rule & Multiplication Rule
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Important Terms
Probability – the chance that an uncertain event will occur (always between 0 and 1)
Event – Each possible outcome of a variable Simple Event – an event that can be described
by a single characteristic Sample Space – the collection of all possible
events
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Sample Space
The Sample Space is the collection of all possible events
e.g. All 6 faces of a die:
e.g. All 52 cards of a bridge deck:
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Events
Simple event An outcome from a sample space with one
characteristic e.g., A red card from a deck of cards
Complement of an event A (denoted A’) All outcomes that are not part of event A e.g., All cards that are not diamonds
Joint event Involves two or more characteristics simultaneously e.g., An ace that is also red from a deck of cards
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Visualizing Events
Contingency Tables
Red 2 24 26
Black 2 24 26
Total 4 48 52
Ace Not Ace Total
Sample Space
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Mutually Exclusive Events
Mutually exclusive events Events that cannot occur together
example:
A = queen of diamonds; B = queen of clubs
Events A and B are mutually exclusive
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Collectively Exhaustive Events
Collectively exhaustive events One of the events must occur The set of events covers the entire sample space
example: A = aces; B = black cards;
C = diamonds; D = hearts
Events A, B, C and D are collectively exhaustive (but not mutually exclusive – an ace may also be a heart)
Events B, C and D are collectively exhaustive and also mutually exclusive
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Probability
Probability is the numerical measure of the likelihood that an event will occur
The probability of any event must be between 0 and 1, inclusively
The sum of the probabilities of all mutually exclusive and collectively exhaustive events is 1
Certain
Impossible
0.5
1
0
0 ≤ P(A) ≤ 1 For any event A
1P(C)P(B)P(A) If A, B, and C are mutually exclusive and collectively exhaustive
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Computing Joint and Marginal Probabilities
The probability of a joint event, A and B:
Computing a marginal (or simple) probability:
Where B1, B2, …, Bk are k mutually exclusive and collectively exhaustive events
outcomeselementaryofnumbertotal
BandAsatisfyingoutcomesofnumber)BandA(P
)BdanP(A)BandP(A)BandP(AP(A) k21
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Joint Probability Example
P(Red and Ace)
BlackColor
Type Red Total
Ace 2 2 4
Non-Ace 24 24 48
Total 26 26 52
52
2
cards of number total
ace and red are that cards of number
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Marginal Probability Example
P(Ace)
BlackColor
Type Red Total
Ace 2 2 4
Non-Ace 24 24 48
Total 26 26 52
52
4
52
2
52
2)BlackandAce(P)dReandAce(P
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General Addition Rule
P(A or B) = P(A) + P(B) - P(A and B)
General Addition Rule:
If A and B are mutually exclusive, then
P(A and B) = 0, so the rule can be simplified:
P(A or B) = P(A) + P(B)
For mutually exclusive events A and B
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General Addition Rule Example
P(Red or Ace) = P(Red) +P(Ace) - P(Red and Ace)
= 26/52 + 4/52 - 2/52 = 28/52Don’t count the two red aces twice!
BlackColor
Type Red Total
Ace 2 2 4
Non-Ace 24 24 48
Total 26 26 52
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Computing Conditional Probabilities
A conditional probability is the probability of one event, given that another event has occurred:
P(B)
B)andP(AB)|P(A
P(A)
B)andP(AA)|P(B
Where P(A and B) = joint probability of A and B
P(A) = marginal probability of A
P(B) = marginal probability of B
The conditional probability of A given that B has occurred
The conditional probability of B given that A has occurred
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What is the probability that a car has a CD player, given that it has AC ?
i.e., we want to find P(CD | AC)
Conditional Probability Example
Of the cars on a used car lot, 70% have air conditioning (AC) and 40% have a CD player (CD). 20% of the cars have both.
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Conditional Probability Example
No CDCD Total
AC 0.2 0.5 0.7
No AC 0.2 0.1 0.3
Total 0.4 0.6 1.0
Of the cars on a used car lot, 70% have air conditioning (AC) and 40% have a CD player (CD). 20% of the cars have both.
0.28570.7
0.2
P(AC)
AC)andP(CDAC)|P(CD
(continued)
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Conditional Probability Example
No CDCD Total
AC 0.2 0.5 0.7
No AC 0.2 0.1 0.3
Total 0.4 0.6 1.0
Given AC, we only consider the top row (70% of the cars). Of these, 20% have a CD player. 20% of 70% is about 28.57%.
0.28570.7
0.2
P(AC)
AC)andP(CDAC)|P(CD
(continued)
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Multiplication Rules
Multiplication rule for two events A and B:
P(B)B)|P(AB)andP(A
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Statistics for Managers Using Microsoft Excel, 5e © 2008 Pearson Prentice-Hall, Inc. Chap 4-20
Statistical Independence
Two events are independent if and only if:
Events A and B are independent when the probability of one event is not affected by the other event
P(A)B)|P(A
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Case Analysis : C & E Company
(a) P(Planning to purchase) =250/1000=0.25
(b) P(actually purchase) = 300/1000=0.30
(c) P(planning to purchase and actually purchased) = 200/1000 = 0.20
(d) P(Actually purchased/planned to purchase) = 200/250 = 0.80
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(e) P(HDTV) = 80/300 = 0.267
(f) P(DVD) = 108/300 = 0.36