Probability

More documents

Recommendations

Info

Conditional probability P(A|B): probability of A given B● “Narrows” the sample space to B P(buy) might be pretty small● Especially if nobody's heard of us P(buy | likes ad) could be much bigger● If the ad is effective: conversion rate Bayes' Theorem (rule): P(A|B) = P(A ∩ B) / P(B)BUSI275: <strong>Probability</strong> 20 Sep 2011 12
Bayes' Theorem: example Let: A = likes our adB = buys our product 40% of the focus group likes our ad● P(?) = .40 Of those who like our ad, 10% buy our product(i.e., 10% conversion rate)● P(?) = .10 ⇒ What fraction of the focus group buys ourproduct?● P(B | A) = P(A ∩ B) / P(A)? = ? / ?BUSI275: <strong>Probability</strong> 20 Sep 2011 13
Page 1: Ch4: Probability20 Sep 2011BUSI275D
Page 4 and 5: Probability Chance of a particular
Page 6 and 7: Venn diagrams Box represents whole
Page 8 and 9: Addition rule: A ∪ BP(A ∪ B)=P(
Page 10 and 11: Mutual exclusivity Two events A and
Page 14 and 15: Statistical independence Two events
Page 16 and 17: Independence and Bayes' rule Recall

Probability

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?