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Decesion Science: "Probability"

The document discusses the concept of probability and provides definitions and examples related to probability, experiments, outcomes, sample space, events, and probability formulas. It also provides examples of calculating probabilities related to drawing cards from a deck and using concepts like "and" and "or". Applications of probability in areas like weather forecasting, politics, and insurance are briefly described.

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sayali bangale
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27 views

Decesion Science: "Probability"

The document discusses the concept of probability and provides definitions and examples related to probability, experiments, outcomes, sample space, events, and probability formulas. It also provides examples of calculating probabilities related to drawing cards from a deck and using concepts like "and" and "or". Applications of probability in areas like weather forecasting, politics, and insurance are briefly described.

Uploaded by

sayali bangale
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Decesion science

“Probability”
By Group B-09
Name Roll no
1. Ashish Chavan 04
2. Faraz Ahmad 21
3. Rohit Hasanpalli 44
4. Sayali Bangale 49
5. Vaibhavi Rajput 62
PROBABILITY
 Probability is the branch of math that studies patterns of chance.

 The idea of probability is based on observation. Probability describes


what happens over many, many trials.

 Definition of Probability- Probability is the measure of how likely it is


the some event will occur, a number expressing the ratio of favorable
cases to the whole number or cases possible.
• Experiment: Is a situation involving chance or probability that leads to
results called outcomes.

• Sample space:
The set of outcomes of an experiment is
known as sample space.

• Event : One or more outcomes in an experiment.

Sample point:
• Each element of the sample space is called
a sample point.
Outcome
• : A possible result of a random experiment. Equally likely
outcomes: All outcomes with equal probability.

• P(E)= No. of Favorable outcomes Total no. of outcomesWhere E = event

• Probability of event to happen P(E) = Number of favourable outcomes/Total


numbers of outcome
Types of event :

Simple Event
Complementary Event
Dependent Event
Independent Event
Mutually Exclusive
Exhaustive Event
• Addition Rule: P(A or B)= P(A) + P(B) – P(A and B)

• Multiplication Rule: P(A ∩ B) = P(B) .P(A)

If P(A) = P(B) then events A and B are equally likely to occur

P(A)= (the number of times the desired outcome occurs) ÷


(the total number of trials)
Some Problems
Example 1: A coin is thrown 3 times .what is the probability that atleast one
head is obtained?

Solution : Sample space = [HHH, HHT, HTH, THH, TTH, THT, HTT, TTT]
Total number of ways = 2 × 2 × 2 = 8.  Fav. Cases = 7
P (A) = 7/8

OR

P (of getting at least one head) = 1 – P (no head)⇒ 1 – (1/8) = 7/8


Question:
1 card is drawn at random from the pack of 52 cards.
(i) Find the Probability that it is an honor card.
(ii) It is a face card.
Solution:

(i) honor cards = (A, J, Q, K) 4 cards from each suits = 4 × 4 = 16


P (honor card) = 16/52 = 4/13

(ii) face cards = (J,Q,K) 3 cards from each suit = 3 × 4 = 12 Cards.


P (face Card) = 12/52 = 3/13
Question 2

Two cards are drawn from the pack of 52 cards. Find the probability
that both are diamonds or both are kings.

Solution:

Total no. of ways = 52C2


Case I: Both are diamonds = 13C2
Case II: Both are kings = 4C2 
P (both are diamonds or both are kings) = (13C2 + 4C2 ) / 52C2
AS E S
A L C
E C I
E S P
SO M
Understanding “And” “or” Concept:
“And”
If the two events are happening at the same time, you need to multiply the two
probabilities together. Usually, the questions use the word “and” when describing the
outcomes.

“Or”
If the two events are happening one after the other, you need to add the two
probabilities. Usually, the questions use the word “or” when describing the outcomes.
Problem on “And” “Or” concept:

• If I roll a number cube and flip a coin: What is the probability I will
get a heads and a 6? What is the probability I will get a tails or a 3?

• Answers : P(heads and 6) = 1/2 x 1/6 =1/12


P(tails or a 5) = 1/2 + 1/6 = 8/12 = 2/3
Example of Bayes’ Theorem

Quesion:

Mohan is a financial analyst at an investment bank. According to his research


of publicly-traded companies, 60% of the companies that increased their
share price by more than 5% in the last three years replaced their CEOs
during the period.
At the same time, only 35% of the companies that did not increase their
share price by more than 5% in the same period replaced their CEOs.
Knowing that the probability that the stock prices grow by more than 5% is
4%, find the probability that the shares of a company that fires its CEO will
increase by more than 5%.
• P(A) – the probability that the stock price increases by 5%
• P(B) – the probability that the CEO is replaced
• P(A|B) – the probability of the stock price increases by 5% given that the CEO
has been replaced
• P(B|A) – the probability of the CEO replacement given the stock price has
increased by 5%.
Application of the problems in specific areas:

• Enhancing Weather Information with Probability


• An Information Statement of the American Meteorological Society
(Adopted by AMS Council on 12 May 2008) Bull. Amer. Meteor. Soc., 89
• A probability forecast includes a numerical expression of uncertainty about the quantity or event
being forecast.  Ideally, all elements (temperature, wind, precipitation, etc.) of a weather forecast
would include information that accurately quantifies the inherent uncertainty.
• for example, the probability of precipitation as estimated by the historical relative frequency that
precipitation has occurred in the past at a given location for a particular time.  A “conditional”
probability is a modification of this climatological probability, formulated by focusing on the
relative frequency with which a particular weather event is associated with a given set of
conditions (e.g., an El Niño year).
Politics

• Many politics analysts use the tactics of probability to predict the outcome
of the election’s results. For example, they may predict a certain political
party to come into power; based on the results of exit polls.
According to Journal of the American Statistical Association’s article;
• Based on generalizations of standard political science forecasting models,
they estimate the probability of a single vote being decisive as about 1 in
10 million for close national elections such as 1992, varying by about a
factor of 10 among states. their results support the argument that
subjective probabilities of many types are best obtained through
empirically based statistical prediction models rather than solely through
mathematical reasoning.
Insurance
• Probability helps in analyzing the best plan of insurance which suits
you and your family the most.

• The subjective method is used when all probable outcomes are not
known in advance, all of the probable outcomes are not equally likely
and there is no similar statistical data from previous experiments
available to use.

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