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Introductory Business Statistics 2e

Formula Review

Introductory Business Statistics 2eFormula Review

Formula Review

3.1 Terminology

A and B are events

P(S) = 1 where S is the sample space

0 ≤ P(A) ≤ 1

P(A||B) = P(A ∩B) P(B) P(A ∩B) P(B)

3.2 Independent and Mutually Exclusive Events

If AA and BB are independent, P(A∩ B)=P(A)P(B),P(A∩B)=P(A)P(B), P(A|B) = P(A)P(A|B)=P(A) and P(B|A) = P(B).P(B|A)=P(B).

If AA and BB are mutually exclusive, P(A ∪ B) = P(A) + P(B)P(A∪B)=P(A)+P(B) and P(A ∩ B) = 0.P(A∩B)=0.

3.3 Two Basic Rules of Probability

The multiplication rule: P(A ∩∩ B) = P(A||B)P(B)

The addition rule: P(A ∪∪ B) = P(A) + P(B) - P(A ∩∩ B)

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