16th Sept. 2011 Module 4, GDB 3 RE: Explain what is wrong and why it is wrong: 1. You bought 10 lottery tickets. One of them won a prize. That means that the probability of winning a prize is 1/10. 2. In a lottery, buying more tickets does not affect your chances of winning a prize. 3. John has 3 suits, 10 shirts, and 12 neckties. He will need to buy some more clothes if he wants to come to work each work day in a different outfit for a whole year. 4. If in a probability distribution you get the sum of probabilities less than one, it just means that you have a smaller-than-normal distribution 5. From the perspective of the insurance company, health insurance policies are set up in such a way that a healthy person has a negative expected value, and a sickly person has a positive one. 1) The probability can only be determined if one knows how any tickets are available for sale. One would take the number of tickets bought divided by the number of total tickets available. The sample size is what one has to have in order to figure out probabilities.
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This note was uploaded on 10/19/2011 for the course MATH 201 taught by Professor R during the Fall '11 term at Lee.