Reference no: EM131227073

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Probability, which measures the likelihood that an event will occur, is an important part of statistics. It is the basis of inferential statistics In inferential statistics, we make decisions under conditions of uncertainty. Probability theory is used to evaluate the uncertainty involved in those decisions. Whether it is a simple or a compound event, the probability of an event is never less than 0 or greater than 1. We can write this property as follows. An event that cannot occur has zero probability and is called an impossible event. An event that is certain to occur has a probability equal to 1 and is called a sure event. Most of the events in real life have probabilities that are greater than zero but less than 1.0. A higher probability such as .86 indicates that the event is more likely to occur. On the other hand, an event with a lower probability such as .14 is less likely to occur. Sometime events with very low (.05 or lower) probabilities are also called rare events.