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03 Survey of Probability Concepts 17e2018 Lind-Ch5
03 Survey of Probability Concepts 17e2018 Lind-Ch5
03 Survey of Probability Concepts 17e2018 Lind-Ch5
Concepts
Chapter 5
Presented by
IAN B. SIAGIAN
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
Learning Objectives
LO5-1 Define the terms probability, experiment, event, and
outcome.
LO5-2 Assign probabilities using a classical, empirical, or
subjective approach.
LO5-3 Calculate probabilities using the rules of addition.
LO5-4 Calculate probabilities using the rules of
multiplication.
LO5-5 Compute probabilities using a contingency table.
LO5-6 Calculate probabilities using Bayes’ theorem.
LO5-7 Determine the number of outcomes using principles
of counting.
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LO5-1 Define the terms probability,
experiment, event, and outcome.
Probability
PROBABILITY A value between zero and one,
inclusive, describing the relative possibility (chance or
likelihood) an event will occur.
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LO5-1
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LO5-1
P(A) + P(~A) = 1
or P(A) = 1 - P(~A).
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LO5-1
P(B) = 1 - P(~B)
= 1 – .61
= .39
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LO5-2 Assign probabilities using a
classical, empirical, or subjective approach.
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LO5-2
Classical Probability
Empirical Probability
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LO5-2
5-10
LO5-2
5-11
LO5-2
Summarizing Probability
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LO5-3 Calculate probabilities
using rules of addition.
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LO5-3
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LO5-3
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LO5-3
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LO5-3
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LO5-4 Calculate probabilities using
the rules of multiplication.
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LO5-4
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LO5-4
Conditional Probability
A conditional probability is the probability of a
particular event occurring, given that another event has
occurred.
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LO5-4
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LO5-4
The probability that the first shirt selected is white is P(W1) = 9/12.
The probability of selecting a second white shirt (W2 ) is dependent on
the first selection. So, the conditional probability is the probability the
second shirt selected is white, given that the first shirt selected is also
white: P(W2 | W1) = 8/11.
Apply the General Multiplication Rule: P(A and B) = P(A) P(B|A)
The joint probability of selecting 2 white shirts is:
P(W1 and W2) = P(W1)P(W2 |W1) = (9/12)(8/11) = 0.55
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LO5-5 Calculate probabilities using
a contingency table.
Contingency Tables
A contingency table is used to classify sample
observations according to two or more identifiable
characteristics measured.
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LO5-5
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LO5-5
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LO5-5
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LO5-5
Tree Diagrams
A tree diagram is:
1. Useful for portraying conditional and joint probabilities.
2. Particularly useful for analyzing business decisions
involving several stages.
3. A graph that is helpful in organizing calculations that
involve several stages.
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LO5-5
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LO5-5
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LO5-6 Calculate probabilities
using Bayes’ theorem.
Bayes’ Theorem
Bayes’ theorem is a method for revising a probability
given additional information.
It is computed using the following formula:
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LO5-6
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LO5-6
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LO5-6
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LO5-6
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LO5-7 Determine the number of
outcomes using principles of counting.
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LO5-7
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LO5-7
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LO5-7
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LO5-7
12! 12!
12 C5 792 12 P 5 95,040
5!(12 5)! (12 5)!
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