Page 9 - FINAL CFA I SLIDES JUNE 2019 DAY 3
P. 9
Session Unit 2:
9. Probability Concepts
LOS 9.f: Calculate and interpret 1) the JP of two events, 2) the p that at least one of two events will occur,
given the p of each and the JP of the two events, and 3) a JP of any number of independent events.
Calculating a JP of any Number of Independent Events, p.175
On the roll of two dice, the JP of getting two 4s is:
P(4 on first die & 4 on second die) = P(4 on first die) × P(4 on second die) = 1/6 × 1/6 = 1/36 = 0.0278
For coins, P(heads on first coin and heads on second coin) = 1/2 × 1/2 = 1/4 = 0.25
Two Types of Independent Events:
1) if And, then use multiplication rule, P(A and B) = P(A) × P(B)
2) if Or, then use additive rule, P(A or B) = P(A) + P(B) – P(AB)
What if more than 3? :
What is the probability of rolling three 4s in one simultaneous toss of three dice?
