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Learn how prior probability informs economic theory and decision-making in Bayesian statistics. Understand its role before collecting new data.

For any event that has multiple outcomes with different probabilities, it can be helpful and illustrative to construct a chart or diagram of the possible outcomes. Tree diagrams are a useful example ...

THE approach to probability adopted in this book is conventional, but cautious. The two definitions, the one a priori, based on equally likely aspects of a system, the second a posteriori, based on ...