Statistics

Statistics

Interpretation of Probability

If the probability of event A occurring is 0.99, this indicates that there is a very good probability of event A occurring. You can multiply the given probability by 100 to see the percent. If we look at event A occurring is 0.99 × 100 = 99%, then there is a 99% chance that event A will occur. Remember, the closer your event is to 1, the greater the probability. The probability can never be more than 1 or less than 0.

Examples for calculating probability:

Let’s say the probability of Event A occurring is 0.75 and we want to know the probability of B occurring. We will assume A and B are mutually exclusive. For this example, we take the greatest probability 1 minus the probability of A.

We get the following: 1 – 0.75 = 0.25

So, the probability of B occurring in this case is 0.25 or 25%.

Let’s look at another example. If there is a 0.15 probability of Event A occurring and a 0.20 probability of Event B occurring, then what is the probability that Event A or B will occur, given that A and B are mutually exclusive?

For this example, we simply add the probabilities together. 0.15 + 0.20 = 0.35 or a 35%

In this example, there is a 35% chance that events A or B will occur.

It is important that you note the probabilities of A and B do not have to equal 100%. There may be other events or outcomes outside of A and B that can occur. Additionally, in this example, you may have outcomes where A and B do not occur at all.

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