4.2.1 Conditional Probability Definitions Video
Conditional probability is an absolutely basic idea that we use all the time. It's the probability that some event occurs, given certain information about it. For example, an insurance company wants to know, what's the probability that you'll live for the next 10 years given your medical history? Or a typical investor wants to know, what's the probability that this stock is going to rise given its stock price gyrations for the past month? There are people who actually think you could do that, the chartists. That, not knowing anything about the nature of the company, or the business that the stock is part of, that just by watching the price gyration you can make a better guess on what the stock will do tomorrow than you could otherwise. Another good example is for a system engineer. What's the probability that the system is going to overload, given the recent history of the rate at which requests have been coming in? And finally, as a joke that I like t...