Business Stat Lecture 2 01 24 2012 Set Operations Venn Diagram Complement complement of A denoted by Ac is the event consisting of all outcomes that are not contained in A Union union of A and B denoted by A U B is the event consisting of all outcomes that are either in A or B Intersection intersection of A and B denoted by A upside down U B is event consisting of all outcomes that are in both A and B A and B are said to be disjoint or mutually exclusive if A and B have no outcomes in common Relative Frequency proportion measuring how often or how frequently the event occurs in a sequence of experiments Ex experiment of tossing a coin if experiment is repeate many times the relative frequency of heads will usually be close to Law of Large Numbers LLN relative frequency of an outcome converges to a number probability of the outcome as the number of repeated experiments increase Subjective Personal Probability measures an individual s belief in the statement he she is making Ex What is the probability that the Lakers will win the NBA final this year hard to interpret such a probability using frequency interpretation because basketball season can only be played once P E Number of outcomes in event E Number of outcomes in sample space S probability of event E equals proportion of outcomes in sample space contained in E 01 24 2012 01 24 2012