Business Statistics Chapter 4
mutually exclusive
events are called this if they do not share any common outcome of an experiment
experiment
a process that leads to one of several possible outcomes
event
any subset of outcomes of the experiment
sample space
contains all possible outcomes of the experiment
exhaustive
events are called this if all possible outcomes of an experiment belong to the events
contingency table
generally shows frequencies for two qualitative variables, x and y, where each cell represents a mutually exclusive combination of the pair of x and y values
law of large numbers
law that says that the empirical probability approaches the classical probability if the experiment is run a very large number of times
probability
numerical value that measures the likelihood that an event occurs. This value is between zero and one, where a value of zero indicates impossible events and a value of one indicates definite events
joint probabilities
probabilities of the intersection of two events
subjective probability
probability calculated by drawing on personal and subjective judgment
classical probability
probability that is based on logical analysis rather than on observation or personal judgment
empirical probability
probability that is calculated as a relative frequency of occurrence
total probability rule
rule that expresses the probability of an event, A, in terms of probabilities of the intersection of A with any mutually exclusive and exhaustive events.
complement rule
rule that states that the probability of the complement of an event is equal to one minus the probability of the event
multiplication rule
rule that states that the probability that A and B bot occur is equal to the probability that A occurs given that B has occurred times the probability that B occurs
addition rule
rule that states that the probability that A or B occurs, or that at least one of these events occurs, is equal to the probability that both A and B occur
joint probability table
table in which the frequency in each cell is divided by the number of outcomes in the sample space
union
the _____ of two events is the event consisting of all outcomes in A or B
intersection
the ______ of two events is the event consisting of all outcomes in A and B
complement
the _______ of an event A is the event consisting of all outcomes in sample space S that are not in A
combination formula
the number of ways to choose x objects from a total of n objects, where the order in which the x objects are listed does not matter, is calculated using the _________ ________
permutation formula
the number of ways to choose x objects from a total of n objects, where the order in which the x objects is listed does matter, is calculated using the _________ _______
independent
two events are ________ if the occurrence of one event does not affect the probability of the occurrence of another event
conditional probability
where the probability of an event is conditional on the occurrence of another event