Decision Making Review

In probability theory two events are said to be independent if the occurrence of one does not affect the probability of the other.

The tendency to believe that every process in which randomness is involved corresponds to a fair distribution, with equal probabilities for any possible outcome.

The assumption that when selecting the most probable occurrence from a list of possibilities, the occurrence that comes most easily to mind is the most probable.

When relying on past event to estimate probabilities

To ignore data concerning group size

It’s often the case that we base probability estimates on data about averages or means. However the average might be made of extremes.

A very large sample will most likely best reflect a population to greater extent to a small sample

Drawing a conclusion about a population upon a bias sample, where the bias of the sample is the result of an improper selection procedure.

Drawing conclusion about population on the basis of an examination of the sample that didn't adequately test for the properties of the population. Common in survey data where the questions are improperly posed.