Chapter 4, Problem 1RP

Why is probability theory important to statistics?

To determine

Explain the reason for the probability theory if it is important to statistics.

Explanation of Solution

The probability of an event:

The probability of an event is obtained as the ratio of favorable number of cases to the total number of outcomes. The probability of an event can be obtained by the formula:

$\begin{array}{c}\text{Probability=}\frac{\text{Number of ways event occurs}}{\text{Total number of outcomes}}\\ =\frac{f}{N}\end{array}$

The probability theoryis helpful for controlling and evaluating the likelihood that a statistical inference is correct. Also,the probability theory provides the mathematical basis for statistical inference.