Professional Documents
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by AMIR D. ACZEL & JAYAVEL SOUNDERPANDIAN 7th edition. Prepared by Lloyd Jaisingh, Morehead State University
Chapter 2
Probability
McGraw-Hill/Irwin Copyright 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
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2 Probability
Using Statistics Basic Definitions: Events, Sample Space, and Probabilities Basic Rules for Probability Conditional Probability Independence of Events Combinatorial Concepts The Law of Total Probability and Bayes Theorem The Joint Probability Table Using the Computer
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LEARNING OBJECTIVES
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A quantitative measure of uncertainty A measure of the strength of belief in the occurrence of an uncertain event A measure of the degree of chance or likelihood of occurrence of an uncertain event Measured by a number between 0 and 1 (or between 0% and 100%)
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Types of Probability
based on equally-likely events based on long-run relative frequency of events not based on personal beliefs is the same for all observers (objective) examples: toss a coin, roll a die, pick a card
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Subjective Probability
based on personal beliefs, experiences, prejudices, intuition - personal judgment different for all observers (subjective) examples: Super Bowl, elections, new product introduction, snowfall
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Empty set (denoted by ) a set containing no elements Universal set (denoted by S) a set containing all possible elements Complement (Not). The complement of A is a set containing all elements of S not in A
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Complement of a Set
A
A
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Intersection (And) A B a set containing all elements in both A and B Union (Or) A B a set containing all elements in A or B or both
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A B
A B
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Sets: A Union B
A B
A B
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Sets: Partition
S
A1 A3
A2
A4 A5
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Experiment
Process that leads to one of several possible outcomes *, e.g.:
Coin toss
Rolling a die
Pick a card
Introduce a new product Each trial of an experiment has a single observed outcome.
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Events : Definition
Set of all possible outcomes (universal set) for a given experiment E.g.: Roll a regular six-sided die
S = {1,2,3,4,5,6}
Event
A = {2,4,6}
Event A occurs if an outcome in the set A occurs Sum of the probabilities of the outcomes of which it consists P(A) = P(2) + P(4) + P(6)
Probability of an event
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Roll a die Six possible outcomes {1,2,3,4,5,6} If each is equally-likely, the probability of each is 1/6 = 0.1667 = 16.67% 1 P ( e) ! n( S ) Probability of each equally-likely outcome is 1 divided by the number of possible outcomes
Event A (even number)
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Clubs
A K Q J 10 9 8 7 6 5 4 3 2
Spades
A K Q J 10 9 8 7 6 5 4 3 2
A K Q J 10 9 8 7 6 5 4 3 2
Event Ace
n ( Ace ) P ( Ace ) ! n (S ) ! 52 4 ! 13 1
Event Heart
n ( Heart ) P ( Heart ) ! n(S ) ! 52 13 ! 4 1
The intersection of the events Heart and Ace comprises the single point circled twice: the ace of hearts
n ( Heart + Ace ) P ( Heart + Ace ) ! n (S ) ! 52 1
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0 e P ( A) e 1
P( A ) ! 1 P( A)
P ( A B ) ! n( A B ) n( S )
P( A C) ! 0
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P ( A B ) ! 0 so P ( A B ) ! P ( A ) P ( B )
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A B
P( A B)
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P(A B) !
Independent events:
P( AB) ! P( A) P( B A) ! P( B)
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so
P ( D A) ! P ( D )
P( A D) ! P( A)P(D)
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Probabilities
AT& T Telecommunication Computers Total 0.40 0.20 0.60 IBM 0.10 0.30 0.40 Total 0.50 0.50 1.00
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P ( Ace + Heart ) !
4 13 1 * ! ! P ( Ace ) P ( Heart ) 52 52 52
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The probability of the union of several independent events is 1 minus the product of probabilities of their complements:
P ( A A A . An ) ! 1 P( A ) P( A ) P( A ). P ( An ) 1 2 3 1 2 3
Example 2-7: P(Q Q Q . Q ) !1 P(Q ) P(Q ) P(Q ). P(Q ) 1 2 3 10 1 2 3 10 !1 0.9010 !1 0.3487 ! 0.6513
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. . . . . . . . . .
C A B C A C A B
C B C A B A
. . . . . .
ABC
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Factorial
How many ways can you order the 3 letters A, B, and C? There are 3 choices for the first letter, 2 for the second, and 1 for the last, so there are 3*2*1 = 6 possible ways to order the three letters A, B, and C. How many ways are there to order the 6 letters A, B, C, D, E, and F? (6*5*4*3*2*1 = 720) Factorial: For any positive integer n, we define n factorial as: n(n-1)(n-2)...(1). We denote n factorial as n!. The number n! is the number of ways in which n objects can be ordered. By definition 1! = 1 and 0! = 1.
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Pr ! n! n ( n r )!
For example :
6 P3 !
6! 6! 6 * 5 * 4 * 3 * 2 * 1 ! ! ! 6 * 5 * 4 ! 120 ( 6 3 )! 3! 3 * 2 *1
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Bayes Theorem
Bayes theorem enables you, knowing just a little more than the
probability of A given B, to find the probability of B given A. Based on the definition of conditional probability and the law of total probability.
P ( B A) !
Applying the law of total probability to the denominator Applying the definition of conditional probability throughout
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P ( I ) ! 0 ill person, the test will indicate so with probability When administered to an.001
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(.9 2 )( 0.0 0 1) (.9 2 )( 0.0 0 1) ( 0.0 4 )(.9 9 9 ) 0.0 0 0 9 2 0.0 0 0 9 2 ! ! 0.0 0 0 9 2 0.0 3 9 9 6 .0 4 0 8 8 ! .0 2 2 5
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Joint Probabilities
P( Z + I ) ! (0.001)(0.92) !.00092
P( I ) ! 0001 .
P( Z I ) ! 008 .
P( Z + I ) ! (0.001)(0.08) !.00008
P( I ) ! 0999 .
P( Z I ) ! 004 . P( Z I ) ! 096 .
P( Z + I ) ! (0.999)(0.04) !.03996
P( Z + I ) ! (0.999)(0.96) !.95904
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Applying the law of total probability to the denominator Applying the definition of conditional probability throughout
P( AB ) P(B ) ! P( AB ) P(B )
1 1 i i
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An economist believes that during periods of high economic growth, the U.S. dollar appreciates with probability 0.70; in periods of moderate economic growth, the dollar appreciates with probability 0.40; and during periods of low economic growth, the dollar appreciates with probability 0.20. During any period of time, the probability of high economic growth is 0.30, the probability of moderate economic growth is 0.50, and the probability of low economic growth is 0.50. Suppose the dollar has been appreciating during the present period. What is the probability we are experiencing a period of high economic growth?
Partition: H - High growth P(H) = 0.30 M - Moderate growth P(M) = 0.50 L - Low growth P(L) = 0.20
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Joint Probabilities
P ( A + H ) ! ( 0.30 )( 0. 70 ) ! 0. 21
P ( H ) ! 0 .3 0
P ( A H ) ! 0.30
P ( A M ) ! 0. 40
P ( M ) ! 0.50
P ( A L ) ! 0. 20
P ( A + L ) ! ( 0. 20 )( 0. 20 ) ! 0. 04
P ( A L ) ! 0.80
P ( A + L ) ! ( 0. 20 )( 0.80) ! 0.16
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A joint probability table is similar to a contingency table , except that it has probabilities in place of frequencies. The joint probability for Example 2-11 is shown below. The row totals and column totals are called marginal probabilities.
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A joint probability table is similar to a contingency table , except that it has probabilities in place of frequencies. The joint probability for Example 2-11 is shown on the next slide. The row totals and column totals are called marginal probabilities.
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Medium
Low
$Depreciates
Total
Marginal probabilities are the row totals and the column totals.
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2-8 Using Computer: Template for Calculating the Probability of at least one success
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2-8 Using Computer: Template for Calculating the Probabilities from a Contingency Table-Example 2-11
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