EC507 —Statistics for Economists Fall 2010 Problem Set 1 1.

Two six-sided dice are thrown sequentially, and the face values that come up are recorded. a. List the sample space.

Ω = {(1,1), (1,2), (1,3), (1,4), (1,5), (1,6), (2,1), (2,2), (2,3), (2,4), (2,5), (2,6), (3,1), (3,2), (3,3), (3,4), (3,5), (3,6), (4,1), (4,2), (4,3), (4,4), (4,5), (4,6), (5,1), (5,2), (5,3), (5,4), (5,5), (5,6), (6,1), (6,2), (6,3), (6,4), (6,5), (6,6)}

b. List the elements that make up the following events: i. A = the sum of the two values is at least 5 A = {(1,4), (1,5), (1,6), (2,3), (2,4), (2,5), (2,6), (3,2), (3,3), (3,4), (3,5), (3,6), (4,1), (4,2), (4,3), (4,4), (4,5), (4,6), (5,1), (5,2), (5,3), (5,4), (5,5), (5,6), (6,1), (6,2), (6,3), (6,4), (6,5), (6,6)}

ii. B = the value of the first die is higher than the value of the second
B = {(2,1), (3,1), (3,2), (4,1), (4,2), (4,3), (5,1), (5,2), (5,3), (5,4), (6,1), (6,2), (6,3), (6,4), (6,5)}

iii. C = the product of the two face value is odd
C = {(1,1), (1,3), (1,5), (3,1), (3,3), (3,5), (5,1), (5,3)}

c. List the elements in the following events: i. D = A ∩ B

D = {(3,2), (4,1), (4,2), (4,3), (5,1), (5,2), (5,3), (5,4), (6,1), (6,2), (6,3), (6,4), (6,5)} ii. E = A ∩ C C
E = {(1,4), (1,6), (2,3), (2,4), (2,5), (2,6), (3,2), (3,4), (3,6), (4,1), (4,2), (4,3), (4,4), (4,5), (4,6), (5,2), (5,4), (5,6), (6,1), (6,2), (6,3), (6,4), (6,5), (6,6)}

some news or event may have occurred between the date of the poll and the date of the election ultimately influenced who ultimately won in both counties in some correlated way. On the other hand. P( A ∩ B) ≠ P( A) * P ( B) . First consider the outcome of flipping a coin two times. is this probability that both democratic candidates win 25%? Why or why not? This depends on whether you believe the winner in a county is independent of the election outcome in the neighboring county. Consider the local elections for county executives in two neighboring counties. a. On the one hand. . How would you express the probability that both democratic candidates will win the county executive seat in generic mathematical notation? A = Democrat 1 Wins B = Democrat 2 Wins P( Democrat 1 Wins and Democrat 2 Wins ) = P( A ∩ B) d. the most recent polls may be accurate. As a follow-up to the example from part c. and based on true random sampling so that any deviation between the realized outcome and the poll result is truly random and independent across counties.2. revelation of economic news or a political scandal might advantage a given party in both counties. In this case. What is the probability that both tosses show as heads? P( First Toss H ∩ Second Toss H ) = P( First Toss H ) * P ( Second Toss H ) 1 1 * 2 2 1 = 4 = c. What is the probability that the first toss is a heads? P( First Toss H ) = 1 2 b. Most recent and reliable polls show that 50% of likely voters favor the democratic candidates in both elections. For example.

Behind one of them is the prize. the probability of the prize being behind your first choice remains 1/100. leaving two doors closed: door 1 and an alternative. the show host opens 98 of them to reveal booby prizes. Intuitively. Naturally. Before opening the chosen door. it is the probability that your first choice was wrong. Another way to understand the intuition is to imagine 100 doors. Switching will Win. 2/3. it should be pretty clear that the chance you chose the door with the prize on your first pick is small (1/100). one is opened showing you a booby prize (Door #2). You pick door one. behind which is the first booby prize. The host picks the door to reveal the first booby prize. Three possibilities exist. You are a contestant on a game show. The host picks the door to reveal the second booby prize. the probability that you picked the winning door on your first guess is 1/3. . Among the remaining 99 doors. each with probability 1/3: You pick door one.3. The host then asks you whether you want to switch from the door you chose originally (door #1) to the one unselected unopened door (door #3). Switching will Win. The probability that the remaining unopened door (Door #3) has the prize is not 1/3. You may be wondering: Why doesn’t the probability of the prize being behind door 1 change after the host opens up 98 other doors? It’s because he’s not allowed to open your door! He’s restricted to opening 98 doors from the 99 doors that you did not choose. You pick door 1. the host opens door #2 to reveal a booby prize. Should you switch? Why or why not? Defend you argument formally using probability statements. Among the doors you didn’t choose. and behind 99 of them are booby prizes. Behind one door is the prize—a new car. You pick door one. The host picks either of the other doors to reveal the booby prize. The host of the show presents you with a choice of three doors. behind the other two doors are “booby prizes”. You select a door #1. behind which is the second booby prize. behind which is the car. Hence. Switching will lose.

Let’s examine this using Bayes formula.” You choose Door 1. You might think that the unconditional probability of the booby being behind Door 3 is 1/3. the probability that the prize is behind the Door 1 (your chosen door) never changes with the new information. P( B3) If the prize is behind Door 2. P( B3 | P 2) = 1 . P(B3)=1/2. Hence. Because of this restriction. 1 1* 2 P ( B 3 | P 2) * P ( P 2) P( P 2 | B3) = = 3 = . the host cannot open your chosen door. P2 denote “Prize behind Door #2” etc. By Bayes formula. 1 3 P( B3) 2 . The host opens Door 2 to reveal a booby. Let P1 denote “Prize behind Door #1”.e. not 1/3. We want to know the probability that the prize is behind Door 3 given that the host showed bobby behind Door 2. But recall that by the construction of the game. The unconditional probability that the prize is behind Door 2 is P(P2)=1/3. Hence.” The host can only show a booby behind Door 2 or Door 3. this is: P ( B3 | P 2) * P ( P 2) P( P 2 | B3) = . we want P(P3 | B2). That’s why we defined B3 to be “Host shows booby behind Door #3” and NOT “Booby is behind Door #3. This is analogous to the 100 door example. i. Door 1. where the first door chosen cannot be among the ones chosen to be opened by the host. then the probability that Door three has a booby is 1. Let B2 denote “Host shows booby behind Door #2. What is P(B3)? This is tricky. That is.

(This is an example of solving for the probability that an unobserved state is true. Use Bayes Formula to write down in generic mathematic notation for the probability of the defendant being guilty conditional on the witness testifying that the forensic evidence is inconclusive.61 .87 The police testimony presented inconclusive DNA evidence that the defendant was involved in the murder. An independent scientific witness reports to the jury the following conditional probabilities regarding the DNA forensic tests used by the police department: i Present at Murder Scene Inconclusive Not Present at scene P( i | Guilty) .13 P( i | Not Guilty) . P(Guilty | Inconclusive Evidence) = P( Inconclusive Evidence | Guilty ) * P(Guilty ) P( Inconclusive Evidence | Guilty ) * P(Guilty ) + P ( Inconclusive Evidence | Not Guilty ) * P( Not Guilty ) . You are a juror in a murder trial. so the answer will be a function of P(Guilty).26 . Bayesian framework for thinking about prejudice.4. a. in which you hear expert testimony regarding the defendant’s possible guilt. Note P(Guilty) is not given in the problem. You are now responsible for a vote: guilty or innocent of murder. given some observed data).02 .11 .

may play a role in the formation of each juror’s prior probability.371 0. or 1. the subjective probability that the decision-maker holds before viewing any additional evidence provided by the expert scientific witness.8. Certainly.8 1.0. Solve for the probability of the defendant being guilty conditional on the inconclusive evidence.780 0. the way a defendant carries oneself.2 . also known as the prior probability—i. P(Guilty) is the unconditional probability of the state of interest.6.e. . .612 0.4. which is then updated based on the data provided by the witness to form the posterior probability.6 . his demeanor.904 1.4 . For unspecified P(Guilty): P (Guilty | Inconclusive Evidence) = . . .26 * P (Guilty ) + .11 * (1 − P (Guilty )) P(Guilty) 0 .26 * P (Guilty ) .2.000 . even his race. It acts as a “starting” value.b.0 P(Guilty | Inconclusive Evidence) 0 0. where P(Guilty) = 0.

Assume the DNA evidence suggested the defendant was not present at the murder.2 0 0 0.) P(Guilty | Inconclusive Evidence) 1. What prior probability would you have to hold so that the probability of the defendant is guilty conditional on the new DNA evidence is greater than 50%? (Note that Bayes posterior probability of guilt is increasing in the prior probability of guilt.c.4 0.87 .4 0.5 = .6 0.13 * P(Guilty ) .8 1 P(Guilty) .87 * (1 − P(Guilty )) P(Guilty ) = .8 0.13 * P(Guilty ) + .6 0.2 1 0.2 0.

so that there are ( n − 2) units (individuals) plus the A-B unit. What is the probability that two particular people will be seated next to each other? (Hint: every possible seating arrangement has the same probability of occurring. n! n . Suppose that n people are seated in a single row of n theater seats in a random manner. That is. Pr( E ) = (n − 1) ! * 2 2 = . There are (n − 1)! ways to arrange (n − 1) units. if we define E to be the event that A and B are seated next to each other.) Recall that every possible arrangement of seating occurs with equal probability. Denominator: The number of ways to seat n people equals n ! Therefore.5. can be seated next to each other is (n − 1)! * 2 . We’re not done yet. for a total of ( n − 1) units. can sit next to each other in a row of n chairs) (# of ways n people can be seated in a row of n chairs) Numerator: The trick is to initially consider A and B as a single unit. divided by the total number of possible seating arrangements. Therefore the probability that A and B are seated next to each other is simply the total number of possible arrangements when A and B are seated next to each other. A and B. We now need to calculate the number of ways (n − 1) units can be seated. there is a corresponding B-A seating arrangement. So the total number of ways 2 particular people. This ensures that A and B are seated next to each other. Note that for every A-B possibility. then Pr( E ) = (# of ways 2 people. A and B.

B and C are disjoint.34629 Note that this is equivalent to solving the problem using combinatorics.34629 22   2  . If you know anything about cycling culture. and randomly picks socks out of his sock drawer. and C represent getting a pink pair.02381 22 21 Pr(B) = Pr(C) = Since the three events are disjoint. fashion is very important.6. B represent getting a pair of orange socks. and where A. Pr(matching pair of socks) = # of pairings where socks match # of possible sock pairings 5 6 11  + +  2 2 2  = = 0. first. Then Pr(A) = 5 4 ∗ = 0. Wing (your TA) often gets up early to go on a bike ride with her cycling team.04329 22 21 6 5 ∗ = 0. Unfortunately. What is the probability the two socks he chooses will match? (Hint: break the problem down by color.0649 22 21 11 10 ∗ = 0. including always having matching socks. 6 single orange socks and 11 single pink socks. Pr(A ∪ B ∪ C) = Pr(A) + Pr(B) + Pr(C) = 0. Let the event A represent the event of getting a pair of white socks. Wing groggily stumbles around in the dark each morning.) Here the total number of socks is 22. he does not have time to organize his sock drawer. His drawer contains 5 single white socks. since Wing spends so much time getting ready for TAing EC507. and every pair of socks has the same probability of being drawn. and we are sampling without replacement.