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Probability

Preparation- Hypothesis & Setup


The purpose of the experiment is to prove the law of large numbers
 To start this project off we need to know the meaning of what the
Law of Large Numbers means: “Law of large numbers, in statistics,
the theorem that, as the number of identically distributed, randomly
generated variables increases, their sample mean (average)
approaches their theoretical mean”.
We want to know if the true probability as we play more and more will
get closer to the probability we calculated.
The experiment will be done in 10 sets for 10, 100, 1000, 10000
simulations. After that we will simulate the average of each one and
compare them. And it will be al randomized.

Experiment

We have collect random data and work on excel with it. These are the
bets that we are working on.
 Red and black
 Even and odd
 First 18 or last 18
The result of 18/38 is 0.473684211

To perform this experiment I will follow these steps:



Determine the probability of winning with an “even” bet. That is a bet
on the red/black, even/odd, or first 18/ last 18 sets. On each of the
above bets there is 18 ways to win, out of 38 different possibilities.
Place that probability in cell “A1”. You can calculate the probability
right in the cell by typing in cell A1 - “=18/38”
In cell “B1” type the following formula – “=Rand()”. This generates a
number that is greater than or equal to 0 and less than 1.
In cell C1 type the following formula – “= if(B1 <= $A$1,1,0)”. What
this does is if the randomly generated number in cell B1 is less than or
equal to the probability of winning then it marks the “C” column cell
with a 1, denoting a win. Other wise it places a 0 in the “C” column
denoting a loss.
Left Click the mouse on cell b1, and while holding the click down drag
your mouse over cell c1. Let the mouse click go. This should highlight
the cells B1 and C1. There should be a small box in the lower right had
corner of cell C1. Place the mouse over the box and drag the box down
to the appropriate number of cells. For example 10, 100, 1000, 10000,
respectively for each of the above experiments.


In cell C11, C101, C1001, C10001 respectively for each of the
experiments, click on the “Σ” in the toolbar at the top of excel or type
the following formula. “Sum(C1:C10)”. Both of these do the exact
same thing. It will be necessary to replace the C10, with C100, C1000,
and C10000 for each of the respective simulations.
Make sure that you record the win totals for each of the simulations,
because each time you change the spreadsheet in any way it
recalculates all random numbers.
Add a number in cell D11, with D101, D1001, and D10001, this re-fire
the random numbers and give you a new total. Do this to produce 10
simulations for each of the 10, 100, 1000, & 10000 trails. (i.e you are
running 10 simulations of each of the different outputs, or 40 trials, 10
for 10 trials, 10, for 100, 10 for 1000, 10 for 10000).
Repeat assignment for 100, 1000 and 10000 trials.

Percentage of wins
Coun Coun Coun Coun Coun Coun Coun Coun Coun Count #
t1
t2
t3
t4
t5
t6
t7
t8
t9
10
bets
10
3
7
5
6
3
5
4
4
3
4
46
45
56
57
47
46
55
48
44
45 100
100
466
483
481
494
471
461
449
447
484
472
0
100
4690 4719 4730 4739 4805 4699 4721 4719 4777
4737
00

Percentage of wins
Coun Coun Coun Coun Coun Coun Coun Coun Coun Count #
t1
t2
t3
t4
t5
t6
t7
t8
t9
10
bets
10
30%
70%
50%
60%
30%
50%
40%
40%
30%
40%
46%
45%
56%
57%
47%
46%
55%
48%
44%
45% 100
100
47%
48%
48%
49%
47%
46%
45%
45%
48%
47%
0
100
47%
47%
47%
47%
48%
47%
47%
47%
48%
47%
00

Percentage of Wins in a Roulette Wheel
80%
70%
60%
50%
40%
30%
20%
10%
0%
1

2

3
10

4
100

5

6
1000

7

8

9

10

10000

Figure 1 represents the winning of 10, 100, 1000, 10000.

Probabili
Count
Mean
ty
10
4.4
0.44
100
48.9
0.489
1000
470.8
0.4708
10000
4733.6 0.47336

Ponder – Conclusion
 The Law of Large Numbers, which is a theorem proved about the
mathematical model of probability, shows that this model is consistent
with the frequency interpretation of probability. From this experiment
we can conclude that as a procedure is repeated over and over, the
frequency tends to approach the actual probability. Our true probability
is 0.473684211 and we can see that the more times we bet the closer
we get to our real probability.
 We can also see on the graph that it goes from 30% to 70% in the 10
tries.
 As a flaw we can say that excel could be wrong maybe because it is
not for calculation.
 Also we could have made any mistakes while we were entering the
random numbers that excel was giving us.
We are now in a position to prove our first fundamental theorem of
probability. We have seen that an intuitive way to view the probability of a
certain outcome is as the frequency with which that outcome occurs in the
long run, when the experiment is repeated a large number of times. We have
also defined probability mathematically as a value of a distribution function
for the random variable representing the experiment.