Basic Probability Concepts (Part 1)

Probability
Degree of certainty or uncertainty that a certain event will occur Ranges from 0 to 1

l---------------------------l----------------------------l 0 0.5 1 Impossible Sure Event Event

STATISTICAL EXPERIMENT, SAMPLE SPACE, AND EVENTS

Experiment
A process that generates well-defined experimental outcomes
experimental outcome = sample point

For a single repetition of an experiment, only one of all possible outcomes occurs

Experiment

Experimental Outcomes

Tossing a fair coin

Rolling a fair die Playing a board game Coming to class

Head, Tail
1, 2, 3, 4, 5, 6 Win, Tie, Lose Early, On time, Late

Experiment Tossing a fair coin

Experimental Outcomes H, T

Rolling a fair die

Playing a board game Coming to class

1, 2, 3, 4, 5, 6
W, T, L E, O, L

Sample space
The set of all experimental outcomes / sample points

Experiment

Sample Space

Tossing a fair coin

Rolling a fair die Playing a board game Coming to class

S = {H, T}
S = {1, 2, 3, 4, 5, 6} S = {W, T, L} S = {E, O, L}

 But there is such a thing as MultipleStep experiments. . .

Tossing a fair coin twice Rolling a fair die twice Playing a board game thrice Coming to class 26 times

Multiple-Step Experiment Tossing a fair coin twice

Sample Space S = {(H,H), (T,H), (H,T), (T,T)}

Rolling a fair die twice

Playing a board game thrice Coming to class 26 times

S = {(1,1), (1,2), (1,3), ... ,(6,6)}

S = {(W,W,W), (W,W,T), (W,W,L), (W,T,W), ... , (L,L,L)} S = {(E,E,...,E), ... , (L,L,...,L)}

Counting Rule for Multiple-Step Experiments

If an experiment can be described as a sequence of k steps with n1 possible outcomes on the first step, n2 possible outcomes on the second step, and so on, then the total number of experimental outcomes is given by (n1)(n2)...(nk)
(Anderson, Sweeney, & Williams, 2008).

Multiple-Step Experiment

Sample Space

Total Number of Experimental Outcomes 2x2=4 6 x 6 = 36 3 x 3 x 3 = 27 3^26 = 2.54 x 10^12

Tossing a fair coin twice

S = {(H,H), (T,H), (H,T), (T,T)}

Rolling a fair die S = {(1,1), (1,2), (1,3), ... ,(6,6)} twice Playing a board game thrice S = {(W,W,W), (W,W,T), (W,W,L), (W,T,W), ... , (L,L,L)}

Coming to class S = {(E,E,...,E), ... , (L,L,...,L)} 26 times

Consider the multiple-step experiment of (1) tossing a fair coin then (2) playing a board game Sample space of (1) S = {H, T} Sample space of (2) S = {W, T, L}
Therefore, the sample space of this multiple-step experiment is... S = {(H,W), (H,T), (H,L), (T,W), (T,T), (T,L)}

This experiment has 2 x 3 = 6 outcomes

COUNTING TECHNIQUES

Combination
counting the number of experimental outcomes when n objects are to be selected from a set of N objects

where, N! = N(N-1)(N-2) . . . (2)(1) n! = n(n-1)(n-2) . . . (2)(1) and, by definition, 0! = 1

! is called factorial

Combination: EXAMPLE 1
How many ways can an HR manager randomly hire two applicants from a set of five applicants?

Combination: EXAMPLE 2
A salesperson is going mall-to-mall to promote her new juice drink. But for today, she can go to only 3 of the 14 Pasig malls. How many sets of 3 Pasig malls can she go to today?

Permutation
counting the number of experimental outcomes when n objects are to be selected from a set of N objects
but with regard to order

where, N! = N(N-1)(N-2) . . . (2)(1) n! = n(n-1)(n-2) . . . (2)(1) and, by definition, 0! = 1

Permutation: EXAMPLE 1
How many ways can an HR manager randomly hire a product development specialist and a advertising specialist from a set of five applicants?

Permutation: EXAMPLE 2
A salesperson is going mall-to-mall to promote her new juice drink. But for this morning, afternoon and evening, she can go to only three of the 14 Pasig malls. How many ways can she schedule her mall visits today?

OTHER EXAMPLES

1
You are studying the roof maintenance patterns of the household heads at a barrio. You have decided to stratify by appearance of the household. In your very good appearance stratum, there are 8 households / household heads (HHs). From that particular group. . .

1
QUESTIONS: 1. How many ways can you randomly select 2 HHs? 2. How many ways can you randomly select 3 HHs? 3. How many ways can you randomly interview 3 HHs?

2
How many ways can you arrange the letters of the following words?
WATER INTEGRAL CURIOUS BOOKKEEPER

3
The CEO of a company is planning to have an official executive photo for him, his two female vice presidents and his two male vice presidents. They are to line up for picture taking.

3
QUESTIONS: 1.How many arrangements are possible? 2.How many arrangements are possible if...
a. One male VP insists on standing on the rightmost side b. One female VP insists on standing right next to the CEO

ASSIGNING PROBABILITIES

Two basic requirements for assigning probabilities

1. The probability assigned to each experimental outcome must be between 0 and 1, inclusively. If we let Ei denote the ith experimental outcome and P(Ei) its probability, then this requirement can be written as

(Anderson, Sweeney & Williams, 2008).

Two basic requirements for assigning probabilities

2. The sum of the probabilities for all the experimental outcomes must equal 1. For n experimental outcomes, this requirement can be written as
(Anderson, Sweeney & Williams, 2008).

Three methods of assigning probabilities

1. Classical method all experimental outcomes are equally likely if there are n possible experimental outcomes, a probability of 1/n is assigned to each experimental outcome
EXAMPLES: Tossing a fair coin P(Head) = P(Tail) = Rolling a fair die P(1) = P(2) = P(3) = P(4) = P(5) = P(6) = 1/6

Three methods of assigning probabilities 2. Relative frequency (or empirical)

method appropriate when estimates on the
proportion of the time the experimental outcome will occur if the experiment is repeated a large number of times are available EXAMPLE (Waiting time of patients as observed over a 20day period) # of patients waiting # of days this outcome occurred 0 2 1 5 2 6 3 4

Relative frequency approximation:

Number of times an event occurred ___________________________ Number of times experiment was conducted

Three methods of assigning probabilities

3. Subjective method -- when little data are available -- based on experience, intuition, rumors, and/or belief -- must still satisfy the two basic requirements for assigning probabilities

EXAMPLES*
1. Suppose an experiment has five equally likely outcomes: E1, E2, E3, E4, E5. Assign probabilities to each outcome. Which method did you use?
2. A decision maker subjectively assigned the following probabilities to four possible outcomes of an experiment: P(E1) = .10, P(E2) = .15, P(E3) = .40, and P(E4) = .20 Are these probabilities valid?

*from Anderson, Sweeney, & Williams (2008)

EXAMPLES*
3. An experiment with three outcomes has been repeated 50 times, and it was learned that E1 occurred 20 times, E2 occurred 13 times, and E3 occurred 17 times. Assign probabilities to the outcomes. Which method did you use?

*from Anderson, Sweeney, & Williams (2008)

EVENTS AND THEIR PROBABILITIES

Event
Any subset of a sample space A collection of sample points An event is said to have occurred if any one of its sample points appears as the experimental outcome

Probability of an Event
The sum of the probabilities of all the sample points in the event If A is an event, the probability of event A is denoted by P(A)

Example
50 students in a class each specified the number of their siblings. Following are the results:
Number of siblings Number of students who specified the number on the left

1 2 3 4 5 6

3 9 13 13 8 4

Let Event A = the event of randomly picking a student with at most 3 siblings Event B = . . . . . at least 5 siblings What is P(A)? What is P(B)?

 Any time that we can identify all the sample points of an experiment and assign probabilities to each, we can compute the probability of an event using the definition...
...However, in many experiments, the large number of sample points makes the identification of the sample points, as well as the determination of their associated probabilities, extremely cumbersome, if not impossible (Anderson, Sweeney, & Williams, 2008).

Main references
Anderson, D.R., Sweeney, D.J., and Williams, T.A. (2008). Modern Business Statistics with Microsoft Excel. Cincinnati, OH: South-Western/Thomson Learning. UP School of Statistics. (n.d.). Statistics 101 Handout / Course Notes. Diliman, Quezon City.
Walpole, R. (1982). Introduction to Statistics. Singapore: Pearson Education.

Basic Probability Concepts (Part 1)