Chapter 4: Probability

One story about how probability theory was developed is that a gambler wanted to know when to bet more and when to bet less. He talked to a couple of friends of his that happened to be mathematicians. Their names were Pierre de Fermat and Blaise Pascal. Since then many other mathematicians have worked to develop probability theory.

Understanding probabilities are important in life. Examples of mundane questions that probability can answer for you are if you need to carry an umbrella or wear a heavy coat on a given day. More important questions that probability can help with are your chances that the car you are buying will need more maintenance, your chances of passing a class, your chances of winning the lottery, your chances of being in a car accident, and the chances that the U.S. will be attacked by terrorists. Most people do not have a very good understanding of probability, so they worry about being attacked by a terrorist but not about being in a car accident. The probability of being in a terrorist attack is much smaller than the probability of being in a car accident, thus it actually would make more sense to worry about driving. Also, the chance of you winning the lottery is very small, yet many people will spend the money on lottery tickets. Yet, if instead they saved the money that they spend on the lottery, they would have more money. In general, events that have a low probability (under 5%) are unlikely to occur. Whereas if an event has a high probability of happening (over 80%), then there is a good chance that the event will happen. This chapter will present some of the theory that you need to help make a determination of whether an event is likely to happen or not.

First you need some definitions.