27-1-2022
Thursday
3:50 pm
#112

Let's talk about Probability.

Probability is everywhere. From flipping a coin to playing the lottery. From tossing a dice to casting your vote in an election. But what many of us don't realize is the mathematical reasoning behind probability and so we often misjudge it.

We use probability in everyday activities such as playing games, deciding what to study in school and how to invest etc.

Mathematically, the probability of an event is defined as the ratio of the number of ways in which the event can occur to the total number of events possible.

A bit of explanation:

If there are three balls and one is yellow, what is the probability that I pick a yellow ball? There are only two ways a yellow ball can be picked: either by choosing the first ball or the second ball.

If I flip a coin, it has a 50% probability of landing on either heads or tails, right?

There are two outcomes in flipping a coin (heads and tails). There are two ways to assign probabilities to each outcome. Which is either ½ or 0.5

For example, there’s a 0.5 probability that you’ll mint the rare NFTs, meaning that if you mint an NFT a 100 times, on average you would mint rare ones 50 times.

Probability is a very important tool to know in your repertoire. It lives in the same neighborhood as statistics, which is another field that every human should at least be aware of. Together, these two concepts are very powerful for decision making, regardless of the environment you happen to be operating in.

Probability is defined as the likelihood of an event occurring.

Everyday, we realize that there are two outcomes to a situation. Whether it be quitting your job or asking out that girl that caught your eye. The most common probability we see are these:

In real life, we don't see a result so black and white. No one ever asks us "What's the chance of you getting fat?" Instead, we are usually given a certain percentage of one happening over another. When we talk about weight gain, you know someone is going to say "80%" because there's no way out of it!

Regardless, we still feel like there's a 50% chance of one happening over another. But when you look at the numbers, the numbers tell a different story. 75% of people have not pointed out the possibility of being fat being higher than if they don't gain weight.

We live in a world of probability. From rolling dice to flipping coins, we deal with probability every day. Whether it’s a 50/50 chance or a 1% chance that the result comes out the way we want, we still play the game.

We go on a date even though there’s a 50% chance that we end up being single again at the end of it. We “flip a coin” in our head to decide who should be the “designated driver” even though we know neither option is ideal.

We even talk about probability in our daily lives without thinking about it.

Closing thought:

I would tell you that every action we take in life has a 50% chance of happening, a 50% chance of not happening. Therefore, "impossible" is actually impossible in the world of probability and logic.

"Odds aren't in your favor."

"The odds are against you."

These are common phrases we come across every day. While these words may seem harmless, they carry a dark undertone regarding how we view chance and probability.

It is hard to imagine success without taking risks because in the business world, risk is an inherent part of profit-making. And yet, it is also important to understand the possibilities of failing and the odds of success.