Business Statistics

Chapter 5 | Probability 189

where

! ( ) ( 1) ( 2) (2) (1)N N N N= × − × − × × ×

! ( ) ( 1) ( 2) (2) (1)n n n n= × − × − × × ×

!0 = 1

Counting rules for permutations

!

! ( , )

!( )

= × =

−

N

n

N

P n C N n

N n

Classical approach to probability

The probability of occurrence of an event E is given by

P (E) =

e

n

N

where n

e

is the number of favourable cases to event E and N the exhaustive number of cases (total possible outcomes of an experiment E).

Relative frequency techniques

e

p

( )

n

P E

n

=

where n

e

is the number in the population with condition E and n

p

the total number of trials in the population

Marginal probability

P(E) =

e

n

N

where n

e

is the number of favourable ...