ECON 221 Lecture Notes - Lecture 2: Frequentist Probability
16 Dec 2016
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Document Summary
There are 3 ways to build probabilities: classical probability, relative frequency probability, subjective probability, classical probability. This probability is about counting the number of outcomes and using that number to determine the probability. Formula for it is p(c)= nc/ n, where nc is nb of outcomes. There are 2 methods to the classical probability: permutation: it is the total number of permutation of x chosen from n . 2) computation: it is x objects chosen from n . Order is not important b) relative frequency probability. This probability is the number of proportion that event b happens in a big number of trials n . Formula for it is similar to the classical probability: P(a)= na/n, where na is the nb of outcomes. N is the total nb of outcomes c) subjective probability: This probability is the least difficult one because it is one about a person"s belief about any outcome or event.
