In section 7.1, we examined the probabilities of individual outcomes in the sample space of and experiment. We could find the probability of each outcome if the outcomes were equally likely by counting the number of outcomes in the sample space. In the case where outcomes were not equally likely, the probabilities could be determined by repeating the experiment many times and recording the relative frequency of each outcome.
In this section we look at collections of outcomes called events. These events contain collections of outcomes from the experiment as well as outcomes created by combining other events. We’ll calculate the likelihood of these events using several probability rules. These basic rules form the foundation for calculating the likelihood of events commonly encountered in business and finance.
Read in Section 7.2
- How do you find the probability of an event?
- What is the complement of an event?
- How do you find the probability of a compound event?
- What is the difference between marginal and joint probability?
- Handout – Union Rule Example (Computer Backup)