Page 31 - FINAL CFA I SLIDES JUNE 2019 DAY 3

LOS 9.o: Identify the most appropriate method to Session Unit 2:
solve a particular counting problem and solve
counting problems using factorial, combination, and 9. Probability Concepts
permutation concepts, p.194/195

Combination, p194 Permutation, p.195

A special case of labelling: e.g. Only 2 categories feasible and order does not
matter; so, No need to replace! Special case of labelling when the order of selection is
important.
You are given 8 Digits and asked to set up a 3-Digit Password
(irrespective of order, as long as it is 3 digits).
How may ways can you pick 3 digits from 8
to do a 3-digit password –if order of password digits does
How many Alternative Combinations of 3 not matter? Then you must replace!
Digits can you come up with?

= 8! = 56!
= 8! = 336
(8-3)!3!
(8-3)!1!

• nCr is the no. of possible ways (Combinations) of selecting r items from a
set of n items when the order of selection is not important