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Overview of basic concepts in Statistics and Probability - SAMSI

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Example: Incidence <strong>of</strong> a rare disease<br />

<strong>Overview</strong> <strong>of</strong><br />

<strong>basic</strong> <strong>concepts</strong><br />

<strong>in</strong> <strong>Statistics</strong><br />

<strong>and</strong><br />

<strong>Probability</strong><br />

Avanti<br />

Athreya<br />

Prelim<strong>in</strong>aries<br />

Important<br />

distributions,<br />

scal<strong>in</strong>g laws,<br />

<strong>and</strong> the CLT<br />

Parametric<br />

estimation <strong>and</strong><br />

hypothesis<br />

test<strong>in</strong>g<br />

Example: Suppose the <strong>in</strong>cidence <strong>of</strong> a disease is 1 <strong>in</strong> 1000, <strong>and</strong><br />

suppose that a diagnostic test is such that if an <strong>in</strong>dividual has<br />

the disease, the test result will be positive 99 percent <strong>of</strong> the<br />

time, but if the <strong>in</strong>dividual doesn’t have the disease, the test<br />

result will be positive 2 percent <strong>of</strong> the time. Given that a<br />

r<strong>and</strong>omly selected <strong>in</strong>dividual tests positive, what is the<br />

probability he or she is actually <strong>in</strong>fected?

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