Malelang, Roseanne Pearl B.

BSA 2-4
Management Science
Group Number 4
Chapter 11: Probability and Statistics
Question Number 1
Question: Give the types of probability. Explain each

Answer:
A probability is a number that expresses the chance or likelihood of an event
occurring. Probabilities can be stated as proportions ranging from 0 to 1, as well as
percentages ranging from 0% to 100%. There are two known basic types of probability
which are objective probability and subjective priority.

Objective Probability
The probabilities or odds that an event will occur based on the examination of
concrete measures rather than hunches or guesswork are referred to as objective
probability. Each measure is based on a documented observation, a hard fact, or a long
history of data collection. The probability estimate is calculated by manipulating data
with mathematical equations to determine the chance of an independent event
occurring. Objective probability is further subdivided into two types, which are the
classical or a priori probability and the relative frequency probability.
 Classical/ Priori Probability
A priori probability refers to the likelihood of an event occurring when there is a
finite number of outcomes and each is equally likely to occur. The prior outcome
has no bearing on the events in a priori probability. An example of a priori
probability is the chance of picking a winning raffle ticket out of 1,000 tickets.
Since there are a thousand tickets, each ticket has a one in a thousand (1/1,000
or 0.001) probability of winning.

 Relative frequency probability

Relative frequency probability, also known as experimental probability or
empirical probability uses the number of occurrences of an outcome within a
sample set as a basis for determining the probability of that outcome. The
chance of "event X" occurring is the number of times "event X" occurs out of 100
trials. An example of a relative frequency probability is when a coin was flipped a
hundred times, the number of times a head actually did appear would be the
 relative frequency, so if there were 59 heads and 41 tails the relative frequency
of flipping a head would be (or 0.59 or 59%).

Subjective Probability
Subjective probability is a type of probability that is based on an individual's
personal assessment or experience about the likelihood of a given result. It does not
include any formal computations and just reflects the subject's personal ideas and
previous experiences. Subjective probabilities vary greatly from one person to the next
and are heavily influenced by personal bias. An example of a subjective probability is a
BSA student from the Polytechnic University of the Philippines is thinking that she has a
60% chance of overcoming the retention policy of the College of Accountancy and
Finance because she thinks she has done a good performance in the comprehensive
examination, but she also has a low grade in some of her accounting subjects which is
also a criterion of the college to be a third-year BSA student.