BUEC 232 Chapter 4-5: BUEC232 - Ch.04,05 Part 1 Notes

• School: Simon Fraser University
• Department: Business Economics
• Course: BUEC 232
• Professor: George Zhang

Document Summary

Probability rules: the probability p(a) of any event a satisfies 1 p(a) 0. Each individual outcome of event a is between 0 and 1 and all outcomes of a must sum to 1. If s is the sample pace in a probability model, then p(s) = 1. The complement of any event a is the vent that a doesn"t occur, written as ac. P(ac) = 1 p(a: general addition rule: P(a b) = p(at least a or b occurs) = p(a) + p(b) p(a & b) A & b are disjoint if they have no elements in common and cannot occur simultaneously, i. e. p(a & b) = 0. P(a or b) = p(a or b occurs) = p(a) + p(b: general multiplication rule: P(a & b) = p(a) * p(b|a) where p(b|a) is the conditional probability that b occurs, given a occurs.