# PROBABILITY. Chapter. 0009T_c04_ qxd 06/03/03 19:53 Page 133

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1 0009T_c04_ qxd 06/03/03 19:53 Page 133 Chapter 4 PROBABILITY Please stand up in front of the class and give your oral report on describing data using statistical methods. Does this request to speak in front of people in public make you panic? If so, what is the likelihood, or probability, that you are a woman? Among professionals, 33% of women and 11% of men fear public speaking. (See Case Study 4 1.) What is probability, and how is it determined? We often make statements about probability. For example, a weather forecaster may predict that there is an 80% chance of rain tomorrow. A health news reporter may state that a smoker has a much greater chance of getting cancer than a nonsmoker does. A college student may ask an instructor about the chances of passing a course or getting an A if he or she did not do well on the midterm examination. Probability, which measures the likelihood that an event will occur, is an important part of statistics. It is the basis of inferential statistics, which will be introduced in later chapters. In inferential statistics, we make decisions under conditions of uncertainty. Probability theory is used to evaluate the uncertainty involved in those decisions. For example, estimating next year s sales for a company is based on many assumptions, some of which may happen to be true and others may not. Probability theory will help 4.1 Experiment, Outcomes, and Sample Space 4.2 Calculating Probability 4.3 Counting Rule 4.4 Marginal and Conditional Probabilities Case Study 4 1 Facing a Crowd Isn t Easy 4.5 Mutually Exclusive Events 4.6 Independent versus Dependent Events 4.7 Complementary Events 4.8 Intersection of Events and the Multiplication Rule Case Study 4 2 Baseball Players have Slumps and Streaks 4.9 Union of Events and the Addition Rule Uses and Misuses Glossary Key Formulas 133

2 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability Supplementary Exercises Self-Review Test Mini-Projects Technology Instruction Technology Assignment us make decisions under such conditions of imperfect information and uncertainty. Combining probability and probability distributions (which are discussed in Chapters 5 through 7) with descriptive statistics will help us make decisions about populations based on information obtained from samples. This chapter presents the basic concepts of probability and the rules for computing probability. 4.1 EXPERIMENT, OUTCOMES, AND SAMPLE SPACE Quality control inspector Jack Cook of Tennis Products Company picks up a tennis ball from the production line to check whether it is good or defective. Cook s act of inspecting a tennis ball is an example of a statistical experiment. The result of his inspection will be that the ball is either good or defective. Each of these two observations is called an outcome (also called a basic or final outcome) of the experiment, and these outcomes taken together constitute the sample space for this experiment. Definition Experiment, Outcomes, and Sample Space An experiment is a process that, when performed, results in one and only one of many observations. These observations are called the outcomes of the experiment. The collection of all outcomes for an experiment is called a sample space. A sample space is denoted by S. The sample space for the example of inspecting a tennis ball is written as S 5good, defective6 The elements of a sample space are called sample points. Table 4.1 lists some examples of experiments, their outcomes, and their sample spaces. Table 4.1 Examples of Experiments, Outcomes, and Sample Spaces Experiment Outcomes Sample Space Toss a coin once Head, Tail S {Head, Tail} Roll a die once 1, 2, 3, 4, 5, 6 S {1, 2, 3, 4, 5, 6} Toss a coin twice HH, HT, TH, TT S {HH, HT, TH, TT} Play lottery Win, Lose S {Win, Lose} Take a test Pass, Fail S {Pass, Fail} Select a student Male, Female S {Male, Female} The sample space for an experiment can also be illustrated by drawing either a Venn diagram or a tree diagram. A Venn diagram is a picture (a closed geometric shape such as a rectangle, a square, or a circle) that depicts all the possible outcomes for an experiment. In a tree diagram, each outcome is represented by a branch of the tree. Venn and tree diagrams help us understand probability concepts by presenting them visually. Examples 4 1 through 4 3 describe how to draw these diagrams for statistical experiments.

4 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability EXAMPLE 4 3 Drawing Venn and tree diagrams: two selections. Suppose we randomly select two persons from the members of a club and observe whether the person selected each time is a man or a woman. Write all the outcomes for this experiment. Draw the Venn and tree diagrams for this experiment. Solution Let us denote the selection of a man by M and that of a woman by W. We can compare the selection of two persons to two tosses of a coin. Just as each toss of a coin can result in one of two outcomes, head or tail, each selection from the members of this club can result in one of two outcomes, man or woman. As we can see from the Venn and tree diagrams of Figure 4.3, there are four final outcomes: MM, MW, WM, WW. Hence, the sample space is written as S 5MM, MW, WM, WW6 S MM WM MW WW First selection M W Second selection M W M Final outcomes MM MW WM Figure 4.3 (a) Venn diagram and (b) tree diagram for selecting two persons. (a) (b) W WW Simple and Compound Events An event consists of one or more of the outcomes of an experiment. Definition Event An event is a collection of one or more of the outcomes of an experiment. An event may be a simple event or a compound event. A simple event is also called an elementary event, and a compound event is also called a composite event. Simple Event Each of the final outcomes for an experiment is called a simple event. In other words, a simple event includes one and only one outcome. Usually simple events are denoted by E 1, E 2, E 3, and so forth. However, we can denote them by any of the other letters, too that is, by A, B, C, and so forth. Definition Simple Event An event that includes one and only one of the (final) outcomes for an experiment is called a simple event and is usually denoted by E i. Example 4 4 describes simple events.

5 0009T_c04_ qxd 06/03/03 19:53 Page Experiment, Outcomes, and Sample Space 137 EXAMPLE 4 4 Reconsider Example 4 3 on selecting two persons from the members of a club and observing whether the person selected each time is a man or a woman. Each of the final four outcomes (MM, MW, WM, and WW) for this experiment is a simple event. These four events can be denoted by E 1, E 2, E 3, and E 4, respectively. Thus, E 1 1MM2, E 2 1MW2, E 3 1WM2, and E 4 1WW2 Illustrating simple events. Compound Event A compound event consists of more than one outcome. Definition Compound Event experiment. A compound event is a collection of more than one outcome for an Compound events are denoted by A, B, C, D... or by A 1, A 2, A 3...,B 1, B 2, B 3..., and so forth. Examples 4 5 and 4 6 describe compound events. EXAMPLE 4 5 Reconsider Example 4 3 on selecting two persons from the members of a club and observing whether the person selected each time is a man or a woman. Let A be the event that at most one man is selected. Event A will occur if either no man or one man is selected. Hence, the event A is given by A 5MW, WM, WW6 Because event A contains more than one outcome, it is a compound event. The Venn diagram in Figure 4.4 gives a graphic presentation of compound event A. Illustrating a compound event: two selections. S MM MW WM WW Figure 4.4 Venn diagram for event A. A EXAMPLE 4 6 In a group of people, some are in favor of genetic engineering and others are against it. Two persons are selected at random from this group and asked whether they are in favor of or against genetic engineering. How many distinct outcomes are possible? Draw a Venn diagram and a tree diagram for this experiment. List all the outcomes included in each of the following events and mention whether they are simple or compound events. (a) Both persons are in favor of genetic engineering. (b) At most one person is against genetic engineering. (c) Exactly one person is in favor of genetic engineering. Illustrating simple and compound events: two selections. Solution Let F a person is in favor of genetic engineering A a person is against genetic engineering

6 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability This experiment has the following four outcomes: FF both persons are in favor of genetic engineering FA the first person is in favor and the second is against AF the first person is against and the second is in favor AA both persons are against genetic engineering The Venn and tree diagrams in Figure 4.5 show these four outcomes. (a) The event both persons are in favor of genetic engineering will occur if FF is obtained. Thus, Both persons are in favor of genetic engineering 5FF6 Because this event includes only one of the final four outcomes, it is a simple event. (b) The event at most one person is against genetic engineering will occur if either none or one of the persons selected is against genetic engineering. Consequently, At most one person is against genetic engineering 5FF, FA, AF6 Because this event includes more than one outcome, it is a compound event. S Venn diagram FF FA AF AA (a) First person F A Tree diagram Second person (b) F A F A Final outcomes FF FA AF AA Figure 4.5 Venn and tree diagrams. (c) The event exactly one person is in favor of genetic engineering will occur if one of the two persons selected is in favor and the other is against genetic engineering. Hence, it includes the following two outcomes: Exactly one person is in favor of genetic engineering 5FA, AF6 Because this event includes more than one outcome, it is a compound event. EXERCISES CONCEPTS AND PROCEDURES 4.1 Define the following terms: experiment, outcome, sample space, simple event, and compound event. 4.2 List the simple events for each of the following statistical experiments in a sample space S. a. One roll of a die b. Three tosses of a coin c. One toss of a coin and one roll of a die 4.3 A box contains three items that are labeled A, B, and C. Two items are selected at random (without replacement) from this box. List all the possible outcomes for this experiment. Write the sample space S.

7 0009T_c04_ qxd 06/03/03 19:53 Page Experiment, Outcomes, and Sample Space 139 APPLICATIONS 4.4 Two students are randomly selected from a statistics class, and it is observed whether or not they suffer from math anxiety. How many total outcomes are possible? Draw a tree diagram for this experiment. Draw a Venn diagram. 4.5 In a group of adults, some are computer literate, and the others are computer illiterate. If two adults are randomly selected from this group, how many total outcomes are possible? Draw a tree diagram for this experiment. 4.6 A test contains two multiple-choice questions. If a student makes a random guess to answer each question, how many outcomes are possible? Depict all these outcomes in a Venn diagram. Also draw a tree diagram for this experiment. (Hint: Consider two outcomes for each question either the answer is correct or it is wrong.) 4.7 A box contains a certain number of computer parts, a few of which are defective. Two parts are selected at random from this box and inspected to determine if they are good or defective. How many total outcomes are possible? Draw a tree diagram for this experiment. 4.8 In a group of people, some are in favor of a tax increase on rich people to reduce the federal deficit and others are against it. (Assume that there is no other outcome such as no opinion and do not know. ) Three persons are selected at random from this group and their opinions in favor or against raising such taxes are noted. How many total outcomes are possible? Write these outcomes in a sample space S. Draw a tree diagram for this experiment. 4.9 Draw a tree diagram for three tosses of a coin. List all outcomes for this experiment in a sample space S Refer to Exercise 4.4. List all the outcomes included in each of the following events. Indicate which are simple and which are compound events. a. Both students suffer from math anxiety. b. Exactly one student suffers from math anxiety. c. The first student does not suffer and the second suffers from math anxiety. d. None of the students suffers from math anxiety Refer to Exercise 4.5. List all the outcomes included in each of the following events. Indicate which are simple and which are compound events. a. One person is computer literate and the other is not. b. At least one person is computer literate. c. Not more than one person is computer literate. d. The first person is computer literate and the second is not Refer to Exercise 4.6. List all the outcomes included in each of the following events and mention which are simple and which are compound events. a. Both answers are correct. b. At most one answer is wrong. c. The first answer is correct and the second is wrong. d. Exactly one answer is wrong Refer to Exercise 4.7. List all the outcomes included in each of the following events. Indicate which are simple and which are compound events. a. At least one part is good. b. Exactly one part is defective. c. The first part is good and the second is defective. d. At most one part is good Refer to Exercise 4.8. List all the outcomes included in each of the following events and mention which are simple and which are compound events. a. At most one person is against a tax increase on rich people. b. Exactly two persons are in favor of a tax increase on rich people. c. At least one person is against a tax increase on rich people. d. More than one person is against a tax increase on rich people.

8 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability 4.2 CALCULATING PROBABILITY Probability, which gives the likelihood of occurrence of an event, is denoted by P. The probability that a simple event E i will occur is denoted by P(E i ), and the probability that a compound event A will occur is denoted by P(A). Definition Probability occur. Probability is a numerical measure of the likelihood that a specific event will Two Properties of Probability 1. The probability of an event always lies in the range 0 to 1. Whether it is a simple or a compound event, the probability of an event is never less than 0 or greater than 1. Using mathematical notation, we can write this property as follows. First Property of Probability 0 P1E i P1A2 1 An event that cannot occur has zero probability; such an event is called an impossible event. An event that is certain to occur has a probability equal to 1 and is called a sure event. That is, For an impossible event M: P 1M2 0 For a sure event C: P 1C The sum of the probabilities of all simple events (or final outcomes) for an experiment, denoted by P(E i ), is always 1. Second Property of Probability Thus, for an experiment: P1E i 2 P1E 1 2 P1E 2 2 P1E 3 2 # # # 1 From this property, for the experiment of one toss of a coin, P1H 2 P1T 2 1 For the experiment of two tosses of a coin, P1HH 2 P1HT 2 P1TH 2 P1T T 2 1 For one game of football by a professional team, P1win2 P1loss2 P1tie2 1

9 0009T_c04_ qxd 06/03/03 19:53 Page Calculating Probability Three Conceptual Approaches to Probability The three conceptual approaches to probability are (1) classical probability, (2) the relative frequency concept of probability, and (3) the subjective probability concept. These three concepts are explained next. Classical Probability Many times, various outcomes for an experiment may have the same probability of occurrence. Such outcomes are called equally likely outcomes. The classical probability rule is applied to compute the probabilities of events for an experiment in which all outcomes are equally likely. Definition Equally Likely Outcomes Two or more outcomes (or events) that have the same probability of occurrence are said to be equally likely outcomes (or events). According to the classical probability rule, the probability of a simple event is equal to 1 divided by the total number of outcomes for the experiment. This is obvious because the sum of the probabilities of all final outcomes for an experiment is 1, and all the final outcomes are equally likely. In contrast, the probability of a compound event A is equal to the number of outcomes favorable to event A divided by the total number of outcomes for the experiment. Classical Probability Rule to Find Probability P1E i 2 P1A2 1 Total number of outcomes for the experiment Number of outcomes favorable to A Total number of outcomes for the experiment Examples 4 7 through 4 9 illustrate how probabilities of events are calculated using the classical probability rule. EXAMPLE 4 7 Find the probability of obtaining a head and the probability of obtaining a tail for one toss of a coin. Calculating the probability of a simple event. Solution The two outcomes, head and tail, are equally likely outcomes. Therefore, 1 Similarly, P1head2 1 Total number of outcomes P1tail If the final answer for the probability of an event does not terminate within three decimal places, usually it is rounded to four decimal places.

10 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability EXAMPLE 4 8 Calculating the probability of a compound event. Find the probability of obtaining an even number in one roll of a die. Solution This experiment has a total of six outcomes: 1, 2, 3, 4, 5, and 6. All these outcomes are equally likely. Let A be an event that an even number is observed on the die. Event A includes three outcomes: 2, 4, and 6; that is, If any one of these three numbers is obtained, event A is said to occur. Hence, P1A2 A 52, 4, 66 Number of outcomes included in A Total number of outcomes EXAMPLE 4 9 Calculating the probability of a compound event. In a group of 500 women, 80 have played golf at least once. Suppose one of these 500 women is randomly selected. What is the probability that she has played golf at least once? Solution Because the selection is to be made randomly, each of the 500 women has the same probability of being selected. Consequently this experiment has a total of 500 equally likely outcomes. Eighty of these 500 outcomes are included in the event that the selected woman has played golf at least once. Hence, P1selected woman has played golf at least once Relative Frequency Concept of Probability Suppose we want to calculate the following probabilities: 1. The probability that the next car that comes out of an auto factory is a lemon 2. The probability that a randomly selected family owns a home 3. The probability that a randomly selected woman has never smoked 4. The probability that an 80-year-old person will live for at least 1 more year 5. The probability that the tossing of an unbalanced coin will result in a head 6. The probability that a randomly selected person owns a Sport-Utility Vehicle (SUV) These probabilities cannot be computed using the classical probability rule because the various outcomes for the corresponding experiments are not equally likely. For example, the next car manufactured at an auto factory may or may not be a lemon. The two outcomes, it is a lemon and it is not a lemon, are not equally likely. If they were, then (approximately) half the cars manufactured by this company would be lemons, and this might prove disastrous to the survival of the firm. Although the various outcomes for each of these experiments are not equally likely, each of these experiments can be performed again and again to generate data. In such cases, to calculate probabilities, we either use past data or generate new data by performing the experiment a large number of times. The relative frequency of an event is used as an approximation for the probability of that event. This method of assigning a probability to an event is called the relative frequency concept of probability. Because relative frequencies are determined by performing an experiment, the probabilities calculated using relative frequencies

11 0009T_c04_ qxd 06/03/03 19:53 Page Calculating Probability 143 may change almost each time an experiment is repeated. For example, every time a new sample of 500 cars is selected from the production line of an auto factory, the number of lemons in those 500 cars is expected to be different. However, the variation in the percentage of lemons will be small if the sample size is large. Note that if we are considering the population, the relative frequency will give an exact probability. Using Relative Frequency as an Approximation of Probability If an experiment is repeated n times and an event A is observed f times, then, according to the relative frequency concept of probability: P1A2 f n Examples 4 10 and 4 11 illustrate how the probabilities of events are approximated using the relative frequencies. EXAMPLE 4 10 Ten of the 500 randomly selected cars manufactured at a certain auto factory are found to be lemons. Assuming that the lemons are manufactured randomly, what is the probability that the next car manufactured at this auto factory is a lemon? Approximating probability by relative frequency: sample data. Solution in n. Then, Let n denote the total number of cars in the sample and f the number of lemons n 500 and f 10 Using the relative frequency concept of probability, we obtain P1next car is a lemon2 f n This probability is actually the relative frequency of lemons in 500 cars. Table 4.2 lists the frequency and relative frequency distributions for this example. Table 4.2 Frequency and Relative Frequency Distributions for the Sample of Cars Car f Relative Frequency Good Lemon n 500 Sum 1.00 The column of relative frequencies in Table 4.2 is used as the column of approximate probabilities. Thus, from the relative frequency column, P1next car is a lemon2.02 P1next car is a good car2.98

12 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability Note that relative frequencies are not probabilities but approximate probabilities. However, if the experiment is repeated again and again, this approximate probability of an outcome obtained from the relative frequency will approach the actual probability of that outcome. This is called the Law of Large Numbers. Definition Law of Large Numbers If an experiment is repeated again and again, the probability of an event obtained from the relative frequency approaches the actual or theoretical probability. EXAMPLE 4 11 Approximating probability by relative frequency. Allison wants to determine the probability that a randomly selected family from New York State owns a home. How can she determine this probability? Solution There are two outcomes for a randomly selected family from New York State: This family owns a home and this family does not own a home. These two events are not equally likely. (Note that these two outcomes will be equally likely if exactly half of the families in New York State own homes and exactly half do not own homes.) Hence, the classical probability rule cannot be applied. However, we can repeat this experiment again and again. In other words, we can select a sample of families from New York State and observe whether or not each of them owns a home. Hence, we will use the relative frequency approach to probability. Suppose Allison selects a random sample of 1000 families from New York State and observes that 670 of them own homes and 330 do not own homes. Then, Consequently, n sample size 1000 f number of families who own homes 670 P1a randomly selected family owns a home2 f n Again, note that.670 is just an approximation of the probability that a randomly selected family from New York State owns a home. Every time Allison repeats this experiment she may obtain a different probability for this event. However, because the sample size (n 1000) in this example is large, the variation is expected to be very small. Subjective Probability Many times we face experiments that neither have equally likely outcomes nor can be repeated to generate data. In such cases, we cannot compute the probabilities of events using the classical probability rule or the relative frequency concept. For example, consider the following probabilities of events: 1. The probability that Carol, who is taking statistics, will earn an A in this course 2. The probability that the Dow Jones Industrial Average will be higher at the end of the next trading day

13 0009T_c04_ qxd 06/03/03 19:53 Page Calculating Probability The probability that the Miami Dolphins will win the Super Bowl next season 4. The probability that Joe will lose the lawsuit he has filed against his landlord Neither the classical probability rule nor the relative frequency concept of probability can be applied to calculate probabilities for these examples. All these examples belong to experiments that have neither equally likely outcomes nor the potential of being repeated. For example, Carol, who is taking statistics, will take the test (or tests) only once, and based on that she will either earn an A or not. The two events she will earn an A and she will not earn an A are not equally likely. The probability assigned to an event in such cases is called subjective probability. It is based on the individual s own judgment, experience, information, and belief. Carol may assign a high probability to the event that she will earn an A in statistics, whereas her instructor may assign a low probability to the same event. Definition Subjective Probability Subjective probability is the probability assigned to an event based on subjective judgment, experience, information, and belief. Subjective probability is assigned arbitrarily. It is usually influenced by the biases, preferences, and experience of the person assigning the probability. EXERCISES CONCEPTS AND PROCEDURES 4.15 Briefly explain the two properties of probability Briefly describe an impossible event and a sure event. What is the probability of the occurrence of each of these two events? 4.17 Briefly explain the three approaches to probability. Give one example of each approach Briefly explain for what kind of experiments we use the classical approach to calculate probabilities of events and for what kind of experiments we use the relative frequency approach Which of the following values cannot be probabilities of events and why? Which of the following values cannot be probabilities of events and why? APPLICATIONS 4.21 Suppose a randomly selected passenger is about to go through the metal detector at the JFK New York airport. Consider the following two outcomes: The passenger sets off the metal detector, and the passenger does not set off the metal detector. Are these two outcomes equally likely? Explain why or why not. If you are to find the probability of these two outcomes, would you use the classical approach or the relative frequency approach? Explain why Thirty-two persons have applied for a security guard position with a company. Of them, 7 have previous experience in this area and 25 do not. Suppose one applicant is selected at random. Consider the following two events: This applicant has previous experience, and this applicant does not have previous experience. If you are to find the probabilities of these two events, would you use the classical approach or the relative frequency approach? Explain why.

14 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability 4.23 The president of a company has a hunch that there is a.80 probability that the company will be successful in marketing a new brand of ice cream. Is this a case of classical, relative frequency, or subjective probability? Explain why The coach of a college football team thinks there is a.75 probability that the team will win the national championship this year. Is this a case of classical, relative frequency, or subjective probability? Explain why A hat contains 40 marbles. Of them, 18 are red and 22 are green. If one marble is randomly selected out of this hat, what is the probability that this marble is a. red b. green? 4.26 A die is rolled once. What is the probability that a. a number less than 5 is obtained b. a number 3 to 6 is obtained? 4.27 A random sample of 2000 adults showed that 860 of them have shopped at least once on the Internet. What is the (approximate) probability that a randomly selected adult has shopped on the Internet? 4.28 In a statistics class of 42 students, 28 have volunteered for community service in the past. Find the probability that a randomly selected student from this class has volunteered for community service in the past In a group of 50 executives, 29 have a type A personality. If one executive is selected at random from this group, what is the probability that this executive has a type A personality? 4.30 Out of the 3000 families who live in an apartment complex in New York City, 600 paid no income tax last year. What is the probability that a randomly selected family from these 3000 families paid income tax last year? 4.31 A multiple-choice question on a test has five answers. If Dianne chooses one answer based on pure guess, what is the probability that her answer is a. correct? b. wrong? Do these two probabilities add up to 1.0? If yes, why? 4.32 A university has a total of 320 professors and 105 of them are women. What is the probability that a randomly selected professor from this university is a a. woman? b. man? Do these two probabilities add up to 1.0? If yes, why? 4.33 A company that plans to hire one new employee has prepared a final list of six candidates, all of whom are equally qualified. Four of these six candidates are women. If the company decides to select at random one person out of these six candidates, what is the probability that this person will be a woman? What is the probability that this person will be a man? Do these two probabilities add up to 1.0? If yes, why? 4.34 A sample of 500 large companies showed that 120 of them offer free psychiatric help to their employees who suffer from psychological problems. If one company is selected at random from this sample, what is the probability that this company offers free psychiatric help to its employees who suffer from psychological problems? What is the probability that this company does not offer free psychiatric help to its employees who suffer from psychological problems? Do these two probabilities add up to 1.0? If yes, why? 4.35 A sample of 400 large companies showed that 130 of them offer free health fitness centers to their employees on the company premises. If one company is selected at random from this sample, what is the probability that this company offers a free health fitness center to its employees on the company premises? What is the probability that this company does not offer a free health fitness center to its employees on the company premises? Do these two probabilities add up to 1.0? If yes, why? 4.36 In a large city, 15,000 workers lost their jobs last year. Of them, 7400 lost their jobs because their companies closed down or moved, 4600 lost their jobs due to insufficient work, and the remainder lost

16 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability EXAMPLE 4 13 Applying the counting rule: 2 steps. A prospective car buyer can choose between a fixed and a variable interest rate and can also choose a payment period of 36 months, 48 months, or 60 months. How many total outcomes are possible? Solution This experiment is made up of two steps: choosing an interest rate and selecting a loan payment period. There are two outcomes (a fixed or a variable interest rate) for the first step and three outcomes (a payment period of 36 months, 48 months, or 60 months) for the second step. Hence, Total outcomes EXAMPLE 4 14 Applying the counting rule: 16 steps. A National Football League team will play 16 games during a regular season. Each game can result in one of three outcomes: a win, a loss, or a tie. The total possible outcomes for 16 games are calculated as follows: Total outcomes ,046,721 One of the 43,046,721 possible outcomes is all 16 wins. 4.4 MARGINAL AND CONDITIONAL PROBABILITIES Suppose all 100 employees of a company were asked whether they are in favor of or against paying high salaries to CEOs of U.S. companies. Table 4.3 gives a two-way classification of the responses of these 100 employees. Table 4.3 Two-Way Classification of Employee Responses In Favor Against Male Female 4 36 Table 4.3 shows the distribution of 100 employees based on two variables or characteristics: gender (male or female) and opinion (in favor or against). Such a table is called a contingency table. In Table 4.3, each box that contains a number is called a cell. Notice that there are four cells. Each cell gives the frequency for two characteristics. For example, 15 employees in this group possess two characteristics: male and in favor of paying high salaries to CEOs. We can interpret the numbers in other cells the same way.

17 0009T_c04_ qxd 06/03/03 19:53 Page Marginal and Conditional Probabilities 149 By adding the row totals and the column totals to Table 4.3, we write Table 4.4. Table 4.4 Two-Way Classification of Employee Responses with Totals In Favor Against Total Male Female Total Suppose one employee is selected at random from these 100 employees. This employee may be classified either on the basis of gender alone or on the basis of opinion. If only one characteristic is considered at a time, the employee selected can be a male, a female, in favor, or against. The probability of each of these four characteristics or events is called marginal probability or simple probability. These probabilities are called marginal probabilities because they are calculated by dividing the corresponding row margins (totals for the rows) or column margins (totals for the columns) by the grand total. Definition Marginal Probability Marginal probability is the probability of a single event without consideration of any other event. Marginal probability is also called simple probability. For Table 4.4, the four marginal probabilities are calculated as follows: P1male2 Number of males Total number of employees As we can observe, the probability that a male will be selected is obtained by dividing the total of the row labeled Male (60) by the grand total (100). Similarly, P1female P1in favor P1against These four marginal probabilities are shown along the right side and along the bottom of Table 4.5. Table 4.5 Listing the Marginal Probabilities In Favor Against (A) (B) Total Male (M ) Female (F ) Total P(M) P(F) P(A) P(B) Now suppose that one employee is selected at random from these 100 employees. Furthermore, assume it is known that this (selected) employee is a male. In other words, the

18 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability event that the employee selected is a male has already occurred. What is the probability that the employee selected is in favor of paying high salaries to CEOs? This probability is written as follows: The event whose probability is to be determined T P(in favor male) c c Read as given This event has already occurred This probability, P(in favor 0 male), is called the conditional probability of in favor. It is read as the probability that the employee selected is in favor given that this employee is a male. Definition Conditional Probability Conditional probability is the probability that an event will occur given that another event has already occurred. If A and B are two events, then the conditional probability of A given B is written as P1A 0 B2 and read as the probability of A given that B has already occurred. EXAMPLE 4 15 Calculating the conditional probability: two-way table. Compute the conditional probability P(in favor 0 male) for the data on 100 employees given in Table 4.4. Solution The probability P(in favor 0 male) is the conditional probability that a randomly selected employee is in favor given that this employee is a male. It is known that the event male has already occurred. Based on the information that the employee selected is a male, we can infer that the employee selected must be one of the 60 males and, hence, must belong to the first row of Table 4.4. Therefore, we are concerned only with the first row of that table. In Favor Against Total Male Males who are in favor The required conditional probability is calculated as follows: P 1in favor 0 male2 Number of males who are in favor Total number of males Total number of males As we can observe from this computation of conditional probability, the total number of males (the event that has already occurred) is written in the denominator and the number of males who are in favor (the event whose probability we are to find) is written in the numerator. Note that we are considering the row of the event that has already occurred. The tree diagram in Figure 4.6 illustrates this example.

19 0009T_c04_ qxd 06/03/03 19:53 Page Marginal and Conditional Probabilities 151 This event has already occurred Male 60/100 Favors Male 15/60 Against Male 45/60 We are to find the probability of this event Required probability Figure 4.6 Tree diagram. Female 40/100 Favors Female 4/40 Against Female 36/40 EXAMPLE 4 16 For the data of Table 4.4, calculate the conditional probability that a randomly selected employee is a female given that this employee is in favor of paying high salaries to CEOs. Calculating the conditional probability: two-way table. Solution We are to compute the probability, P(female 0 in favor). Because it is known that the employee selected is in favor of paying high salaries to CEOs, this employee must belong to the first column (the column labeled in favor ) and must be one of the 19 employees who are in favor. In Favor Hence, the required probability is P 1female 0 in favor Females who are in favor 19 Total number of employees who are in favor The tree diagram in Figure 4.7 illustrates this example. Number of females who are in favor Total number of employees who are in favor This event has already occurred Favors 19/100 Against 81/100 Make Favors 15/19 Female Favors 4/19 Male Against 45/81 Female Against We are to find the probability of this event Required probability Figure 4.7 Tree diagram. 36/81

20 0009T_c04_ qxd 06/03/03 19:53 Page 152 CASE STUDY 4 1 FACING A CROWD ISN T EASY USA TODAY Snapshots R Women 35% Facing a crowd isn't easy Professionals who fear public speaking: Men 35% Source: Sims Wyeth & Co. By Mary M. Kershaw and Bob Laird, USA TODAY The above chart shows the percentage of professional women and men who fear public speaking. These percentages can be written as conditional probabilities as follows. Suppose one professional is selected at random. Then, given that this person is a female, the probability is.35 that she has a public speaking fear. On the other hand, if this selected person is a male, this probability is only.11. These probabilities can be written as follows: P1has fear of public speaking 0 female2.35 Source: USA TODAY, May 20, Copyright 2002, USA TODAY. Chart reproduced with permission. P1has fear of public speaking 0 male2.11 Note that these are approximate probabilities because the data given in the chart are based on a sample survey Case Study 4 1 illustrates the conditional probabilities of professional women and men having fear of public speaking. 4.5 MUTUALLY EXCLUSIVE EVENTS Events that cannot occur together are called mutually exclusive events. Such events do not have any common outcomes. If two or more events are mutually exclusive, then at most one of them will occur every time we repeat the experiment. Thus the occurrence of one event excludes the occurrence of the other event or events. Definition Events that cannot occur together are said to be mutually exclu- Mutually Exclusive Events sive events. 152

21 0009T_c04_ qxd 06/03/03 19:53 Page Mutually Exclusive Events 153 For any experiment, the final outcomes are always mutually exclusive because one and only one of these outcomes is expected to occur in one repetition of the experiment. For example, consider tossing a coin twice. This experiment has four outcomes: HH, HT, TH, and TT. These outcomes are mutually exclusive because one and only one of them will occur when we toss this coin twice. EXAMPLE 4 17 Consider the following events for one roll of a die: A an even number is observed 52, 4, 66 B an odd number is observed 51, 3, 56 C a number less than 5 is observed 51, 2, 3, 46 Are events A and B mutually exclusive? Are events A and C mutually exclusive? Illustrating mutually exclusive and mutually nonexclusive events. Solution Figures 4.8 and 4.9 show the diagrams of events A and B and events A and C, respectively. As we can observe from the definitions of events A and B and from Figure 4.8, events A and B have no common element. For one roll of a die, only one of the two events, A and B, can happen. Hence, these are two mutually exclusive events. We can observe from the definitions of events A and C and from Figure 4.9 that events A and C have two common outcomes: 2-spot and 4-spot. Thus, if we roll a die and obtain either a 2-spot or a 4-spot, then A and C happen at the same time. Hence, events A and C are not mutually exclusive. S B A S 5 C A Figure 4.8 Mutually exclusive events A and B. Figure 4.9 Mutually nonexclusive events A and C. EXAMPLE 4 18 Consider the following two events for a randomly selected adult: Y this adult has shopped at least once on the Internet N this adult has never shopped on the Internet Are events Y and N mutually exclusive? Illustrating mutually exclusive events. Solution Note that event Y consists of all adults who have shopped at least once on the Internet, and event N includes all adults who have never shopped on the Internet. These two events are illustrated in the Venn diagram in Figure 4.10.

22 0009T_c04_ qxd 06/03/03 19:53 Page Chapter 4 Probability S Figure 4.10 Mutually exclusive events Y and N. Y N As we can observe from the definitions of events Y and N and from Figure 4.10, events Y and N have no common outcome. They represent two distinct sets of adults: the ones who have shopped at least once on the Internet and the ones who have never shopped on the Internet. Hence, these two events are mutually exclusive. 4.6 INDEPENDENT VERSUS DEPENDENT EVENTS In the case of two independent events, the occurrence of one event does not change the probability of the occurrence of the other event. Definition Independent Events Two events are said to be independent if the occurrence of one does not affect the probability of the occurrence of the other. In other words, A and B are independent events if either P1A 0 B2 P1A2 or P1B 0 A2 P1B2 It can be shown that if one of these two conditions is true, then the second will also be true, and if one is not true, then the second will also not be true. If the occurrence of one event affects the probability of the occurrence of the other event, then the two events are said to be dependent events. In probability notation, the two events are dependent if either P1A 0 B2 P1A2 or P1B 0 A2 P1B2. EXAMPLE 4 19 Illustrating two dependent events: two-way table. Refer to the information on 100 employees given in Table 4.4 in Section 4.4. Are events female (F) and in favor (A) independent? Solution Events F and A will be independent if P1F2 P1F 0 A2 Otherwise they will be dependent. Using the information given in Table 4.4, we compute the following two probabilities: P1F and P1F 0 A Because these two probabilities are not equal, the two events are dependent. Here, dependence of events means that the percentages of males who are in favor of and against paying high salaries to CEOs are different from the percentages of females who are in favor and against. In this example, the dependence of A and F can also be proved by showing that the probabilities P(A) and P1A 0 F2 are not equal.

23 0009T_c04_ qxd 06/03/03 19:53 Page Independent versus Dependent Events 155 EXAMPLE 4 20 A box contains a total of 100 CDs that were manufactured on two machines. Of them, 60 were manufactured on Machine I. Of the total CDs, 15 are defective. Of the 60 CDs that were manufactured on Machine I, 9 are defective. Let D be the event that a randomly selected CD is defective, and let A be the event that a randomly selected CD was manufactured on Machine I. Are events D and A independent? Illustrating two independent events. Solution Hence, From the given information, P1D and P1D 0 A P1D2 P1D 0 A2 Consequently, the two events, D and A, are independent. Independence, in this example, means that the probability of any CD being defective is the same,.15, irrespective of the machine on which it is manufactured. In other words, the two machines are producing the same percentage of defective CDs. For example, 9 of the 60 CDs manufactured on Machine I are defective and 6 of the 40 CDs manufactured on Machine II are defective. Thus, for each of the two machines, 15% of the CDs produced are defective. Actually, using the given information, we can prepare Table 4.6. The numbers in the shaded cells are given to us. The remaining numbers are calculated by doing some arithmetic manipulations. Table 4.6 Two-Way Classification Table Defective Good (D) (G) Total Machine I (A) Machine II (B) Total Using this table, we can find the following probabilities: P1D P1D 0 A Because these two probabilities are the same, the two events are independent. Two Important Observations We can make two important observations about mutually exclusive, independent, and dependent events. 1. Two events are either mutually exclusive or independent. 2 a. Mutually exclusive events are always dependent. b. Independent events are never mutually exclusive. 2. Dependent events may or may not be mutually exclusive. 2 The exception to this rule occurs when at least one of the two events has a zero probability.

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