Business Statistics, Second Edition

Chapter 6

Fundamentals of Probability

LEARNING OBJECTIVES

After studying this chapter, you should be able to

• help yourself to understand the amount of uncertainty that is involved before making important decisions.

• understand fundamentals of probability and various probability rules that help to you measure uncertainty involving uncertainty.

• perform several analyses with respect to business decision involving uncertainty.

…is touched by that dark miracle of chance which makes new magic in a dusty world.

—Thomas Wolfe

6.1 INTRODUCTION

So far we discussed several methods of summarizing sample data to gain knowledge about the entire population or process. Making inferences from sample data, however, involve uncertainties. Thus decision-makers ...