Probability. A brief Introduction

Contents......Page 3
General questions......Page 5
Classical probability......Page 7
Frequency-based (or empirical) approach......Page 9
The subjective approach: its relevance to Economics and Management......Page 11
Sample space and events......Page 17
The axioms......Page 22
Conditional probability, correlation between events, sto- chastic independence and Bayes Theorem......Page 30
What a random number is......Page 38
The probability distribution of a random number......Page 42
Computer simulation of random numbers......Page 50
Expected value of random number......Page 53
Moments......Page 57
Moment generating function......Page 60
Conditional random numbers and conditional expecta- tions......Page 67
A brief summary of standard distributions......Page 68
The problem......Page 77
The answer to the problem......Page 82
The estimation of......Page 84
The notion of risk-aversion......Page 85
Some popular utility functions......Page 87
Notion of random vector......Page 90
The probability distribution of a random vector......Page 93
The notion of stochastic independence between two ran- dom numbers......Page 98
The expectation of a function of a random vector......Page 101
Second order moments for random vectors......Page 102
The variance of a linear function of random numbers......Page 109
Exercises......Page 122
Refs......Page 152
Index......Page 153