Probability
Definitions
Probability Experiment
Process which leads to well-defined results call outcomes
Outcome
The result of a single trial of a probability experiment
Sample Space
Set of all possible outcomes of a probability experiment
Event
One or more outcomes of a probability experiment
Classical Probability
Uses the sample space to determine the numerical probability that an event will
happen. Also called theoretical probability.
Equally Likely Events
Events which have the same probability of occurring.
Complement of an Event
All the events in the sample space except the given events.
Empirical Probability
Uses a frequency distribution to determine the numerical probability. An
empirical probability is a relative frequency.
Subjective Probability
Uses probability values based on an educated guess or estimate. It employs
opinions and inexact information.
Mutually Exclusive Events
Two events which cannot happen at the same time.
Disjoint Events
Another name for mutually exclusive events.
Independent Events
Two events are independent if the occurrence of one does not affect the
probability of the other occurring.
Dependent Events
Two events are dependent if the first event affects the outcome or occurrence of
the second event in a way the probability is changed.
Conditional Probability
The probability of an event occurring given that another event has already
occurred.
Bayes' Theorem
A formula which allows one to find the probability that an event occurred as
the result of a particular previous event.
Probability Distributions
Definitions
Random Variable
Variable whose values are determined by chance
Probability Distribution
The values a random variable can assume and the corresponding probabilities
of each.
Expected Value
The theoretical mean of the variable.
Binomial Experiment
An experiment with a fixed number of independent trials. Each trial can only
have two outcomes, or outcomes which can be reduced to two outcomes. The
probability of each outcome must remain constant from trial to trial.
Binomial Distribution
The outcomes of a binomial experiment with their corresponding probabilities.
Multinomial Distribution
A probability distribution resulting from an experiment with a fixed number of
independent trials. Each trial has two or more mutually exclusive outcomes.
The probability of each outcome must remain constant from trial to trial.
Poisson Distribution
A probability distribution used when a density of items is distributed over a
period of time. The sample size needs to be large and the probability of success
to be small.
Hypergeometric Distribution
A probability distribution of a variable with two outcomes when sampling is
done without replacement.
Normal Distribution
Definitions
Central Limit Theorem
Theorem which stats as the sample size increases, the sampling distribution of
the sample means will become approximately normally distributed.
Correction for Continuity
A correction applied to convert a discrete distribution to a continuous
distribution.
Finite Population Correction Factor
A correction applied to the standard error of the means when the sample size is
more than 5% of the population size and the sampling is done without
replacement.
Sampling Distribution of the Sample Means
Distribution obtained by using the means computed from random samples of a
specific size.
Sampling Error
Difference which occurs between the sample statistic and the population
parameter due to the fact that the sample isn't a perfect representation of the
population.
Standard Error or the Mean
The standard deviation of the sampling distribution of the sample means. It is
equal to the standard deviation of the population divided by the square root of
the sample size.
Standard Normal Distribution
A normal distribution in which the mean is 0 and the standard deviation is 1. It
is denoted by z.
Z-score
Also known as z-value. A standardized score in which the mean is zero and the
standard deviation is 1. The Z score is used to represent the standard normal
distribution.
