Probability Theory Fundamentals

PROBABILITY
"PROBABILITY THEORY IS NOTHING BUT COMMON SENSE REDUCED TO CALCULATION." - P.S. LAPLACE
PROBABILITY
A numerical measure of the likelihood that a specific event will occur.
An event that cannot occur has zero probability which is called an impossible event
and if an event that is certain to occur has a probability equal to 1 is called sure event.
There are four (4) basic probability rules that will be helpful in solving probability problems.
1. The probability of an event is within the range 0 to 1.
2. The sum of the probabilities of all simple events for an experiment is always 1.
For an experiment:
3. If an event cannot occur, its probability is 0.
4. If an event is certain, then the probability is 1.
PROBABILITY
Complimentary Events
The complement of an event is the set of outcomes in the sample space that are not included in
the outcome of event . The complement of is denoted by (read as E prime).
The rule for complimentary events are denoted by,
(Formula 5-9)
(Formula 5-9)
(Formula 5-9)
PROBABILITY
Three Conceptual Approaches to Probability

A. Classical Probability
Classical probability assumes that all outcomes in the sample space are equally likely to occur.
(Formula 5-10)
PROBABILITY
Example
A card is drawn from an ordinary deck of card. Find these probabilities
a.
Getting king of hearts
b.
Getting a spade
c.
Getting a 5 or a clubs
d.
Getting a 5 or a 7
e.
Getting a card which is not a spade
f.
Getting 14 of clubs
PROBABILITY
Example
Getting king of hearts
Solution
Since there is only one king of hearts in an event E and 52 possible outcomes in the sample space.
Therefore, the probability of getting king of hearts is 0.02 or 2%.
PROBABILITY
Example
Getting a spade
Solution
There are 13 spades so there are 13 outcomes in an event E.
Therefore, the probability of getting a spade is 0.25 or 25%.
PROBABILITY
Example
Getting a 5 or a clubs
Solution
There are four 5s and 13 clubs in an event E, but the 5 of spades are counted twice in this listing.
Thus, there are 16 possible outcomes of drawing 5 or a clubs.
Therefore, the probability of getting a 5 or a clubs is 0.31 or 31%.
This is an example of the inclusive or.
PROBABILITY
Example
Getting a 5 or a 7
Solution

There are four 5s and four 7s in an event E.
Therefore, the probability of getting a 5 or a 7 is 0.15 or 15%.
This is an example of the exclusive or.
PROBABILITY
Example
Solution
There are 39 cards which is not a spade in an event E.
Therefore, the probability of getting a card which is not a spade is 0.75 or 75%.
PROBABILITY
Example
Alternative Solution

Recall that P(spade) is 0.25 or 25%, we simply deduct this to 1 to obtain the probability of getting a
non-spade card. Well use P(E) = 1 P(E), where P(E) is the probability of getting a non-spade
card.
Therefore, the probability of getting a card which is not a spade is 0.75 or 75%.
PROBABILITY
Example
Getting a 14 of clubs
Solution

It is impossible to get a 14 of clubs in the sample space of an ordinary deck of card.
Therefore, the probability of getting a 14 of clubs is 0%.
This is an example of impossible event.
PROBABILITY

B. Empirical or Relative Frequency Probability
Empirical probability is the type of probability that uses frequency distribution based on observations to
determine numerical probabilities of events.
(Formula 5-11)
PROBABILITY
Example
In a sample of 50 college students, 18 are
freshmen, 23 are sophomore, 2 are junior,

and 7 are senior. Set up a frequency
distribution and find the following
probabilities:
Year Level
Frequency
Freshman
18
Sophomore
23
A student is a freshman or a sophomore
Junior
A student is neither a freshman nor a junior
Senior
Total
50
A student is a freshman
A student is not a senior
Solution
PROBABILITY
Example

probabilities:
Solution
To obtain the probability of selecting a
freshman we simply divide the number of
freshmen by the sample space.

Therefore, the probability is 0.36 or 36%.
PROBABILITY
Example

probabilities:
Solution
We need to add the frequency of the two
year level (or classes)
PROBABILITY
Example

probabilities:
Solution
Note that neither a freshman nor a junior
means that the student is either a

sophomore or a senior.
PROBABILITY
Example

probabilities:
Solution
In order to find the probability of not a
senior, we need to subtract the probability of

senior from 1.
PROBABILITY

C. Subjective Probability
Subjective probability is the probability assigned to an event based on subjective judgment, experience,
information, and belief.
For example,
A sportswriter may say that there is 90% probability that University of the East Red Warriors will win the UAAP
championships.
A physician may say that, on the basis of his diagnosis, there is a 60% chance that the patient will recover.
A financial analysis may say that there is 80% probability that peso dollar exchange rate will decrease by 3 pesos.
THE ADDITION RULE AND MULTIPLICATION

RULE
PROBABILITY
ADDITION RULE AND MULTIPLICATION RULE

A lot of problems involve determine the probability of two or more events. This is when
independent, dependent, and mutually exclusive comes into the picture in dealing with
probability.
There are important things to note about mutually exclusive, independent, and
dependent events.
The first is of which is mutually exclusive are always dependent
Secondly is independent events are never mutually exclusive
Lastly is dependent events may or may not be mutually exclusive.
The exception of the first and second is that when at least one of the two events has a zero
probability.
Independent, Dependent, Mutually Exclusive Events

Two events A and B are independent events if the fact that A occurs not affect the probability of B
occurring. In other words, A and B are independent events if,

or
Two events A and B are dependent events for which the outcome or occurrence of event A affects
the outcome or occurrence of event B in such a way that the probability is changed. In other words,
A and B are dependent events if,
or
Two events A and B are mutually exclusive events if they cannot occur at the same time.
Addition Rules for Probability

Rule 1
When two events A and B are mutually
exclusive, the probability that A or B will occur

is
(Formula 5-12)
Addition Rules for Probability
Rule 2
If A and B are not mutually exclusive, then
(Formula 5-13)
Example
A box contains 4 red marbles, 8 blue marbles, and 7 green marbles. If a person selects a marble at
random, find the probability thats either a red or green marble.
Solution

Since the box contains 4 red marbles, 7 green marbles, and a total of 19 marbles.
Therefore, selecting a marble at random thats either a red or green is 0.58 or 58%.
The events are mutually exclusive.
Example
A single card is drawn from an ordinary deck of card. Find the probability that it is a queen or a
diamonds.
Solution

Since a queen of diamonds means a queen and a diamond, it has been counted twice-once as a
queen and once as a diamond; thus, one of the outcomes must be deducted, as shown
Therefore, drawing a queen or a diamond from an ordinary deck is 0.31 or 31%.
Example
In a certain insurance company there are 20
senior salespersons and 30 junior

salespersons; 8 senior and 14 junior
salespersons are males. If a salesperson is
selected, find the probability that the
salesperson is a senior or a female.
The sample space
Salespers
on
Male
Female
Total
Senior
18
12
20
Junior
14
16
30
Total
22
28
50
Solution
Example
In a certain insurance company there are 20
senior salespersons and 30 junior

salespersons; 8 senior and 14 junior
salespersons are males. If a salesperson is
selected, find the probability that the
salesperson is a senior or a female.
Solution
The probability is
0.72 or 72%.
The multiplication rules can be applied to determine the probability of two or more events
that occur in sequence. The probability of the intersection of two events is called their
joint probability. It is written as .

Rule 1
When two events are independent, the probability of both occurring is
(Formula 5-14)
Rule 2
When two events are dependent, the probability of both occurring is
(Formula 5-15)
Rule 3
When two events are mutually exclusive their joint probability is always zero. If A and B are two
mutually exclusive events, then

(Formula 5-16)
Example
A die is rolled and a coin is flipped. Find the probability of getting a 5 on the die and tail on the coin.
Solution

Using the sample space for the die which is 1, 2, 3, 4, 5, 6; for the coin which is Head, Tail.
Therefore, the probability of getting a 5 on the die and tail on the coin is 0.08 or 8%.
Example
A box contains 3 red balls, 8 blue balls, and 9 green balls. A first ball is selected, and then it is
replaced. A second ball is selected. Find the probability of selecting

2 red balls
1 blue ball and 1 green ball

Solution
2 red balls
Therefore, selecting 2 red balls is 0.02 or 2%.
Example
A box contains 3 red balls, 8 blue balls, and 9 green balls. A first ball is selected, and then it is
replaced. A second ball is selected. Find the probability of selecting

2 red balls

Solution
Therefore, selecting 1 blue and 1 green ball is 0.18 or 18%.
Example
A SJS survey found that one out of 5 Filipinos say they are in favor of the death penalty for heinous
crimes. If the people are selected at random, find the probability that all three will say that they are
in favor of death penalty.
Solution
Let D denote that a person is in favor of death penalty. Then
Therefore, the probability that all three will say that they are in favor of death penalty is 0.01 or
1%.
Example
Reina owns a collection of 25 bags, of which 6 are made by Guess. If the 2 bags are selected at
random, find the probability that both are made by Guess.
Solution
Since the events are dependent,
Therefore, the probability that both are made by Guess is 0.05 or 5%.
Example
The RSS Financing Inc. found that 50% of the members had salary long (S) with the financing
company. Of these members 8% also had a calamity loan (C). If a member is selected at random
find the probability that the member has both loans with the company.
Solution
Note that the events are dependent,

Therefore, the probability that the member has both loans with the company is 0.04 or 4%.
MARGINAL AND CONDITIONAL PROBABILITIES

PROBABILITY
Marginal Probability
Marginal Probability is a probability of a single event without consideration of any other event; it is
also called single probability. It can be computed using the formula
(Formula 5-17)
Where
are k mutually exclusive and collectively exhaustive events.
Recall that two events are mutually exclusive if both the events cannot occur simultaneous, while
collectively exhaustive if one of the events must occur.
Conditional Probability
Conditional probability is probability that an event will occur given that another event has already
occurred. If A and B are two events, then the conditional probability is given as P(A|B) and reads as
the probability of A given that B has already occurred. In symbol,
(Formula 5-18) and

given that and

Example
A box contains blue and red balls. A person select two balls without replacement. If the probability
of selecting a blue ball and a red ball is 12/30, and the probability of selecting a blue ball on the first
draw is 3/5, find the probability of selecting a red ball on the second draw, given that the first ball
selected was a blue ball.
Solution

Let
B = selecting a blue ball

R = selecting a red ball
Then,
Thus, the probability of selecting a red ball on the second draw given that the first ball selected was
blue is 0.67 or 67%.


Example
In a fast-food chain, 75% of the customers orders chicken meal. If 40% of the customers orders
chicken meal and sundae, find the probability that the customer orders chicken meal will also order
a sundae.
Solution
Let
C = the customer orders chicken meal

S = the customer orders sundae
Then,
Thus, the customer has a 0.53 or 53% probability of ordering sundae, given that he/she ordered
chicken meal first.

RANDOM VARIABLES AND DISCRETE

PROBABILITY DISTRIBUTION
PROBABILITY
Number
Number of
of TVs
TVs
owned
owned
RANDOM VARIABLES AND DISCRETE

PROBABILITY DISTRIBUTION
Frequency
Frequency
Relative
Relative Frequency
Frequency
Suppose the above table shows the frequency and relative

frequency distribution of the number of TV owned by 500 families
residing in the City of Manila.
RANDOM VARIABLES AND DISCRETE PROBABILITY

DISTRIBUTION
Suppose one family is randomly selected
from this population. The process of random

selecting a family is called a random or
chance experiment.
Number of
TVs owned
Let X denote the number of TVs owned by
the selected family. Then X can assume any

of the 4 possible values (0, 1, 2, and 3)
recorded in the leftmost column of the
table. The value assumed by X depends on
the family is selected.
Hence, this value depends on the outcome
of a random experiment. Therefore, X is

referred to random variable.
Frequency
Relative
Frequency

DISTRIBUTION
A random variable is a function or rule that assigns a number to each outcome of an
experiment, it is called chance variable.

In general, a random variable is denoted by X.
A random variable can be discrete or continuous.
A discrete random variable assumes values that can be counted, while
A continuous random variable can assume all values between any two specific values;
A variable obtained by measuring, or
Contained one or more intervals

DISTRIBUTION
A discrete probability distribution consists of the values a random variable can assume
and the corresponding probabilities of the values. The probabilities are determined
theoretically or by observation. There are several requirements for a distribution of a
discrete random variable. For a discrete random variable X than can assume values ,

1. , for all (The probability outcome is between 0 and 1).
2.
(The sum of all possible outcomes is 1.0).
3. The listing is exhaustive (All possible outcomes are included).

4. The outcomes are mutually exclusive (The outcomes cannot occur at the same time).

DISTRIBUTION
Example
Construct a probability distribution for rolling
a die.
Solution

Since the sample spaces of a die is 1, 2, 3, 4,
5, 6 and each outcome has a probability of ,
the distribution is,
Outcome X
Probability
P(X)
Cumulative
F(X)

DISTRIBUTION
Event
Example
Construct a probability distribution for
tossing three coins. Let X represent the

number of tails.
Solution
The 8 possible events, and the
corresponding values for X, are:
TTT
TTH
THT
HTT
THH
HTH
HHT
HHH

DISTRIBUTION
Example
Construct a probability distribution for
tossing three coins. Let X represent the

number of tails.
Solution
Therefore, the probability distribution for the
number of tails occurring in three coin tosses

is:
Outcome X
Probability P(X)
Cumulative F(X)
BINOMIAL PROBABILITY DISTRIBUTION

PROBABILITY

A binomial experiment is one that
possesses the following properties:

The experiment consists of n repeated trials;
Each trial results in an outcome that may be
classified as a success or a failure (hence

the name, binomial);
The probability of a success, denoted by p,
remains constant from trial to trial and

repeated trials are independent.
The number of successesXinntrials of a
binomial experiment is called abinomial

random variable.
The probability distribution of the random variableXis called abinomial

distribution, and is given by the formula:
Formula (5-19)
Where:
Examples of binomial experiments

Tossing a coin 20 times to see how many
tails occur.
Asking 200 people if they watch ABC news.
Rolling a die to see if a 5 appears.
Examples which aren't binomial experiments
Rolling a die until a 6 appears (not a fixed
number of trials)
Asking 20 people how old they are (not two
outcomes)
Drawing 5 cards from a deck for a poker
hand (done without replacement, so not

independent)
Example
What is the probability of rolling exactly two sixes in 6 rolls of a die?
Solution
There are five things you need to do to work a binomial story problem.
1.
Define Success first. Success must be for a single trial.
2.
Define the probability of success (p):
3.
Find the probability of failure:
4.
Define the number of trials:
5.
Define the number of successes out of those trials:

Example
What is the probability of rolling exactly two
sixes in 6 rolls of a die?
Solution
Anytime a six appears, it is a success
(denoted S) and anytime something else

appears, it is a failure (denoted F). The ways
you can get exactly 2 successes in 6 trials are
given below. The probability of each is written
to the right of the way it could occur. Because
the trials are independent, the probability of
the event (all six dice) is the product of each
probability of each outcome (die):
1.
FFFFSS 5/6 * 5/6 * 5/6 * 5/6 * 1/6 * 1/6 = (1/6)^2 * (5/6)^4
2.
FFFSFS 5/6 * 5/6 * 5/6 * 1/6 * 5/6 * 1/6 = (1/6)^2 * (5/6)^4
3.
FFFSSF 5/6 * 5/6 * 5/6 * 1/6 * 1/6 * 5/6 = (1/6)^2 * (5/6)^4
4.
FFSFFS 5/6 * 5/6 * 1/6 * 5/6 * 5/6 * 1/6 = (1/6)^2 * (5/6)^4
5.
FFSFSF 5/6 * 5/6 * 1/6 * 5/6 * 1/6 * 5/6 = (1/6)^2 * (5/6)^4
6.
FFSSFF 5/6 * 5/6 * 1/6 * 1/6 * 5/6 * 5/6 = (1/6)^2 * (5/6)^4
7.
FSFFFS 5/6 * 1/6 * 5/6 * 5/6 * 5/6 * 1/6 = (1/6)^2 * (5/6)^4

Example
What is the probability of rolling exactly two
sixes in 6 rolls of a die?
Solution
Anytime a six appears, it is a success
(denoted S) and anytime something else

appears, it is a failure (denoted F). The ways
you can get exactly 2 successes in 6 trials are
given below. The probability of each is written
to the right of the way it could occur. Because
the trials are independent, the probability of
the event (all six dice) is the product of each
probability of each outcome (die):
8.
FSFFSF 5/6 * 1/6 * 5/6 * 5/6 * 1/6 * 5/6 = (1/6)^2 * (5/6)^4
9.
FSFSFF 5/6 * 1/6 * 5/6 * 1/6 * 5/6 * 5/6 = (1/6)^2 * (5/6)^4
10.
FSSFFF 5/6 * 1/6 * 1/6 * 5/6 * 5/6 * 5/6 = (1/6)^2 * (5/6)^4
11.
SFFFFS 1/6 * 5/6 * 5/6 * 5/6 * 5/6 * 1/6 = (1/6)^2 * (5/6)^4
12.
SFFFSF 1/6 * 5/6 * 5/6 * 5/6 * 1/6 * 5/6 = (1/6)^2 * (5/6)^4
13.
SFFSFF 1/6 * 5/6 * 5/6 * 1/6 * 5/6 * 5/6 = (1/6)^2 * (5/6)^4
14.
SFSFFF 1/6 * 5/6 * 1/6 * 5/6 * 5/6 * 5/6 = (1/6)^2 * (5/6)^4
15.
SSFFFF 1/6 * 1/6 * 5/6 * 5/6 * 5/6 * 5/6 = (1/6)^2 * (5/6)^4
Example
What is the probability of rolling exactly two sixes in 6 rolls of a die?
Solution
Notice that each of the 15 probabilities are exactly the same: (1/6)^2 * (5/6)^4.
Also, note that the 1/6 is the probability of success and you needed 2 successes. The 5/6 is the
probability of failure, and if 2 of the 6 trials were success, then 4 of the 6 must be failures. Note that
2 is the value of x and 4 is the value of n-x.
Further note that there are fifteen ways this can occur. This is the number of ways 2 successes can
be occur in 6 trials without repetition and order not being important, or a combination of 6 things, 2
at a time.

Example
A coin is tossed 10 times. What is the
probability that exactly 6 heads will occur?
Using formula 5-19,
Solution

Therefore, the probability that exactly 6
heads will occur is 0.21 or 21%.
POISSON PROBABILITY DISTRIBUTION

PROBABILITY
A Poisson distribution is the probability distribution that results from a Poisson experiment.
Attributes of a Poisson Experiment
APoisson experimentis astatistical experimentthat has the following properties:
The experiment results in outcomes that can be classified as successes or failures.
The average number of successes () that occurs in a specified region is known.
The probability that a success will occur is proportional to the size of the region.
The probability that a success will occur in an extremely small region is virtually zero.
Note that the specified region could take many forms. For instance, it could be a length, an area, a volume, a
period of time, etc.
Notation
The following notation is helpful, when we talk about the Poisson distribution.
A constant equal to approximately 2.71828. (Actually,eis the base of the natural logarithm system.)
The mean number of successes that occur in a specified region.
The actual number of successes that occur in a specified region.
ThePoisson probabilitythatexactlyxsuccesses occur in a Poisson experiment, when the mean number

of successes is .

Poisson Distribution
APoisson random variableis the number
of successes that result from a Poisson

experiment.
The probability distributionof a Poisson
random variable is called aPoisson

distribution.
The Poisson distribution has the following
properties:
Given the mean number of successes ()
that occur in a specified region, we can

compute the Poisson probability based on
the following formula:
Poisson Formula.Suppose we conduct a
Poisson experiment, in which the average

number of successes within a given region is.
Then, the Poisson probability is:
(Formula 5-20)
Where
The mean of the distribution is equal to .

Thevarianceis also equal to .
Example
The average number of homes sold by the Acme Realty company is 2 homes per day. What is the
probability that exactly 3 homes will be sold tomorrow?
Solution

This is a Poisson experiment in which we know the following:
; since 2 homes are sold per day, on average.
; since we want to find the likelihood that 3 homes will be sold tomorrow.
; sinceeis a constant equal to approximately 2.71828.
Example
The average number of homes sold by the Acme Realty company is 2 homes per day. What is the
probability that exactly 3 homes will be sold tomorrow?
Solution
We plug these values into the formula 5-20 as follows:
Thus, the probability of selling 3 homes tomorrow is 0.18 or 18%.

Example
If there are 500 customers per eight-hour day in a check-out lane, what is the probability that there
will be exactly 3 in line during any five-minute period?
Solution
The expected value during any one five minute period would be 500 / 96 = 5.21.
The 96 is because there are 96 five-minute periods in eight hours. So, you expect about 5.2 customers in 5
minutes and want to know the probability of getting exactly 3.
This is a Poisson experiment in which we know the following:

5.21; since 5.2 customers in 5 minutes, on average.
; since we want to find the likelihood that 3 will be in line during any five-minute period.
; sinceeis a constant equal to approximately 2.71828.
Example
If there are 500 customers per eight-hour day in a check-out lane, what is the probability that there
will be exactly 3 in line during any five-minute period?
Solution

We plug these values into the formula 5-20 as follows:
Thus, the probability that there will be exactly 3 in line during any five-minute period is
0.14 or 14%.

Probability Theory Fundamentals

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PROBABILITY

the outcome of event . The complement of is denoted by (read as E prime).

The rule for complimentary events are denoted by,

Three Conceptual Approaches to Probability

Getting king of hearts

Getting a card which is not a spade

Therefore, the probability of getting king of hearts is 0.02 or 2%.

There are 13 spades so there are 13 outcomes in an event E.

Therefore, the probability of getting a spade is 0.25 or 25%.

There are 39 cards which is not a spade in an event E.

Three Conceptual Approaches to Probability

freshmen, 23 are sophomore, 2 are junior,

A student is a freshman or a sophomore

A student is neither a freshman nor a junior

A student is not a senior

freshmen, 23 are sophomore, 2 are junior,

To obtain the probability of selecting a

freshman we simply divide the number of

freshmen by the sample space.

freshmen, 23 are sophomore, 2 are junior,

We need to add the frequency of the two

year level (or classes)

Therefore, the probability is 0.82 or 82%.

freshmen, 23 are sophomore, 2 are junior,

Note that neither a freshman nor a junior

means that the student is either a

Therefore, the probability is 0.60 or 60%.

freshmen, 23 are sophomore, 2 are junior,

In order to find the probability of not a

senior, we need to subtract the probability of

Therefore, the probability is 0.86 or 86%.

Three Conceptual Approaches to Probability

THE ADDITION RULE AND MULTIPLICATION

ADDITION RULE AND MULTIPLICATION RULE

ADDITION RULE AND MULTIPLICATION RULE

Independent, Dependent, Mutually Exclusive Events

occurring. In other words, A and B are independent events if,

ADDITION RULE AND MULTIPLICATION RULE

Addition Rules for Probability

When two events A and B are mutually

exclusive, the probability that A or B will occur

ADDITION RULE AND MULTIPLICATION RULE

Addition Rules for Probability

If A and B are not mutually exclusive, then

ADDITION RULE AND MULTIPLICATION RULE

random, find the probability thats either a red or green marble.

ADDITION RULE AND MULTIPLICATION RULE

ADDITION RULE AND MULTIPLICATION RULE

senior salespersons and 30 junior

The sample space

ADDITION RULE AND MULTIPLICATION RULE

senior salespersons and 30 junior

ADDITION RULE AND MULTIPLICATION RULE

ADDITION RULE AND MULTIPLICATION RULE

mutually exclusive events, then

ADDITION RULE AND MULTIPLICATION RULE

ADDITION RULE AND MULTIPLICATION RULE

replaced. A second ball is selected. Find the probability of selecting

1 blue ball and 1 green ball

ADDITION RULE AND MULTIPLICATION RULE

replaced. A second ball is selected. Find the probability of selecting

1 blue ball and 1 green ball

ADDITION RULE AND MULTIPLICATION RULE