Bio Statistics:

A Decision-Making Approach

Some Basic Probability Concepts

Chap 4-1
 Chapter Goals
After completing this chapter, you should be
able to:
 Introduction

 Two Views of Probability: Objective and

Subjective,
 Explain approaches to assessing probabilities

 Apply common rules of probability

 Use Bayes’ Theorem for conditional probabilities

Chap 4-2
 Important Terms

 Probability – the chance that an uncertain event

will occur (always between 0 and 1)
 Experiment – a process of obtaining outcomes
for uncertain events
 Elementary Event – the most basic outcome
possible from a simple experiment
 Sample Space – the collection of all possible
elementary outcomes

Chap 4-3
 Sample Space
The Sample Space is the collection of all
possible outcomes
e.g. All 6 faces of a die:

e.g. All 52 cards of a bridge deck:

Chap 4-4
 Events

 Elementary event – An outcome from a sample

space with one characteristic
 Example: A red card from a deck of cards

 Event – May involve two or more outcomes

simultaneously
 Example: An ace that is also red from a deck of
cards

Chap 4-5
 TWO VIEWS OF PROBABILITY
 OBJECTIVE AND SUBJECTIVE
The concept of objective probability may be
categorized further under the headings of
 (1) classical, or a priori, probability; and

 (2) the relative frequency, or a posteriori,

concept of probability.

Business Statistics: A Decision-Making Approach, 6e © 2005 Prentice-Hall, Inc. Chap 4-6

 TWO VIEWS OF PROBABILITY
Classical Probability: The classical treatment
of probability dates back to the 17th century and
the work of two mathematicians, Pascal and
Fermat. Much of this theory developed out of
attempts to solve problems related to games of
chance, such as those involving the rolling of
dice. Examples from games of chance illustrate
very well the principles involved in classical
probability. For example, if a fair six-sided die is
rolled, the probability that a 1 will be observed is
equal to and is the same for the other five faces.
7
 DEFINITION
If an event can occur in N mutually exclusive
and equally likely ways, and if m of these
possess a trait E, the probability of the
occurrence of E is equal to m/N.

8
 TWO VIEWS OF PROBABILITY

Relative Frequency Probability: The relative

frequency approach to probability depends on
the repeatability of some process and the ability
to count the number of repetitions, as well as the
number of times that some event of interest
occurs. In this context we may define the
probability of observing some characteristic, E,
of an event as follows:

9
 DEFINITION
If some process is repeated a large number of
times, n, and if some resulting event with the
characteristic E occurs m times, the relative
frequency of occurrence of E, m/n will be
approximately equal to the probability of E.

10
 Subjective Probability

DEFINITIONS
The Prior Probability of an event is a probability
based on prior knowledge, prior experience, or
results derived from prior data collection activity.

The Posterior Probability of an event is a

probability obtained by using new information to
update or revise a prior probability.

11
Elementary Properties of
Probability

12
Elementary Properties of
Probability

13
Elementary Properties of
Probability

14
 Rules of Probability
Rules for
Possible Values
and Sum

Individual Values Sum of All Values

0 ≤ P(ei) ≤ 1 k

For any event ei

 P(e )  1i
i 1
where:
k = Number of elementary events
in the sample space
ei = ith elementary event
Chap 4-15