Probability: What are the odds?

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In summary, the conversation discusses a company that split in two, with each owner receiving half of the clients. One owner, Fred, lost 235 clients while the other, Jeff, lost 285. There is a debate about whether this is due to random variability or not, with one person arguing that it is a one in a million chance. However, to accurately determine the odds, one would need to know the original number of clients and use an equation. Based on the estimated total of 2,000 clients, it is unlikely that this was just random variability.
  • #1
jellybean
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My company split in two.
Two owners, Fred and Jeff. Each got half the clients.
Since then, Fred lost 235 clients and Jeff lost 285.
My co-worker says it's just random variability.
I says no way, that's one in a million.
What are the odds? What's the equation?
p.s. true story
 
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  • #2
Randomness would assume this is a binomial distribution with probability p1 Fred will lose a client, probability p2 Jeff will lose a client. For large numbers those can be approximated by normal distributions but to do that you would need to know the total number of clients each one started with and I don't see how you can decide whether it was "random variability" or not without knowing how many clients there were to start with. If the original number of clients was not much more than 235+ 285= 520, this is probably not "random variability". If the original number of clients was much more, then it probably was.
 
  • #3
Oops, you're right. I thought at first it was just a coin toss x 520.
In round numbers, the total was 2,000. So each began with 1,000 clients.
 

Related to Probability: What are the odds?

What is probability?

Probability is a measure of how likely an event is to occur. It is represented as a number between 0 and 1, where 0 means the event is impossible and 1 means the event is certain to occur.

How do you calculate probability?

To calculate probability, divide the number of favorable outcomes by the total number of possible outcomes. This is known as the probability formula: P(event) = number of favorable outcomes / total number of possible outcomes.

What is the difference between theoretical and experimental probability?

Theoretical probability is based on calculations and predictions, while experimental probability is based on actual data from experiments or observations. Theoretical probability is often used to make predictions, while experimental probability is used to analyze and understand real-world situations.

How does probability relate to statistics?

Probability is a branch of mathematics that helps us understand the likelihood of events occurring. It is closely related to statistics, which involves the collection, analysis, and interpretation of data. Probability is used in statistical analysis to make predictions and draw conclusions from data.

What are the odds of an event occurring?

The odds of an event occurring are the ratio of the number of favorable outcomes to the number of unfavorable outcomes. For example, if there is a 1 in 4 chance of winning a game, the odds are 1:3 or 1/4. Odds can also be expressed as a decimal or percentage.

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