### A Matter of Confidence

Q: An urn contains 3 red and 3 blue balls. A ball is drawn from and it socked away. Two people now draw balls from it. They record the color and put the ball back into the urn. The first person A, does this 7 times and draws a red ball all 7 times. The second person B, does this 20 times and draws a red ball 14 times. Both conclude the urn has a majority of red balls but who among them have more confidence in their prediction?

The Probability Tutoring Book: An Intuitive Course for Engineers and Scientists (And Everone Else!)

A: One is tempted to assume that A, who has done more draws which strongly indicate it to be a red-ball majority urn is likely to have a higher confidence. But this is not the case when seen in the Bayesian perspective.

Let $$H$$ denote the hypothesis that the majority are red balls and $$E$$ denote the evidence each user collects. As always, Bayes theorem states
$$P(H|E) = \frac{P(E|H)P(H)}{P(E|H)P(H) + P(E|\neg H)P(\neg H)}$$
For user A, the probability that she gets heads 7 times in a row is $$\big(\frac{3}{5})^{7}$$ if the urn has a red-ball majority. It is $$\big(\frac{2}{5})^{7}$$ if it is a blue-ball majority urn. The prior probability that the urn has a majority of red balls is $$\frac{1}{2}$$. Putting this all together gives us the confidence person A has as
$$P(H|E) = \frac{\big(\frac{3}{5})^{7} \times \frac{1}{2}}{\big(\frac{3}{5})^{7} \times \frac{1}{2} + \big(\frac{2}{5})^{7} \times \frac{1}{2}}\approx 94.5\%$$

Likewise for B
$$P(H|E) = \frac{\big(\frac{3}{5})^{14} \times \big(\frac{2}{5})^{6}\times \frac{1}{2}}{\big(\frac{3}{5})^{14} \times \big(\frac{2}{5})^{6}\times \frac{1}{2} + \big(\frac{3}{5})^{6} \times \big(\frac{2}{5})^{14}\times \frac{1}{2}}\approx 96.24\%$$

Notice, B has higher confidence. This is also intuitive when you think more about it. The fact that the balls are being replaced here is what is causing A to have a rarer event happen (i.e. all 7 are drawn red) making it less plausible to draw a firmer conclusion than B.

If you are looking to learn the art of probability here are a few good books to own

Fifty Challenging Problems in Probability with Solutions (Dover Books on Mathematics)

This book is a great compilation that covers quite a bit of puzzles. What I like about these puzzles are that they are all tractable and don't require too much advanced mathematics to solve.

Introduction to Algorithms
This is a book on algorithms, some of them are probabilistic. But the book is a must have for students, job candidates even full time engineers & data scientists

An Introduction to Probability Theory and Its Applications, Vol. 1, 3rd Edition

The Probability Tutoring Book: An Intuitive Course for Engineers and Scientists (and Everyone Else!)

Introduction to Probability, 2nd Edition

The Mathematics of Poker
Good read. Overall Poker/Blackjack type card games are a good way to get introduced to probability theory

Bundle of Algorithms in Java, Third Edition, Parts 1-5: Fundamentals, Data Structures, Sorting, Searching, and Graph Algorithms (3rd Edition) (Pts. 1-5)
An excellent resource (students/engineers/entrepreneurs) if you are looking for some code that you can take and implement directly on the job.

Understanding Probability: Chance Rules in Everyday Life A bit pricy when compared to the first one, but I like the look and feel of the text used. It is simple to read and understand which is vital especially if you are trying to get into the subject

Data Mining: Practical Machine Learning Tools and Techniques, Third Edition (The Morgan Kaufmann Series in Data Management Systems) This one is a must have if you want to learn machine learning. The book is beautifully written and ideal for the engineer/student who doesn't want to get too much into the details of a machine learned approach but wants a working knowledge of it. There are some great examples and test data in the text book too.

Discovering Statistics Using R
This is a good book if you are new to statistics & probability while simultaneously getting started with a programming language. The book supports R and is written in a casual humorous way making it an easy read. Great for beginners. Some of the data on the companion website could be missing.

1. Why is the likelihood (11/20)^7 ???
Isn't it (3/5)^11*(2/5)^9 ???
B has to draw 14 red balls over 20 to be P(H|E) greater than 0.945.

2. You are right, updated accordingly. Thanks for the point out

### The Best Books to Learn Probability

If you are looking to buy some books in probability here are some of the best books to learn the art of Probability

The Probability Tutoring Book: An Intuitive Course for Engineers and Scientists (and Everyone Else!)
A good book for graduate level classes: has some practice problems in them which is a good thing. But that doesn't make this book any less of buy for the beginner.

An Introduction to Probability Theory and Its Applications, Vol. 1, 3rd Edition
This is a two volume book and the first volume is what will likely interest a beginner because it covers discrete probability. The book tends to treat probability as a theory on its own

Discovering Statistics Using R
This is a good book if you are new to statistics & probability while simultaneously getting started with a programming language. The book supports R and is written in a casual humorous way making it an easy read. Great for beginners. Some of the data on the companion website could be missing.

Fifty Challenging Probl…

### The Best Books for Linear Algebra

The following are some good books to own in the area of Linear Algebra.

Linear Algebra (2nd Edition)
This is the gold standard for linear algebra at an undergraduate level. This book has been around for quite sometime a great book to own.

Linear Algebra: A Modern Introduction
Good book if you want to learn more on the subject of linear algebra however typos in the text could be a problem.

Linear Algebra (Dover Books on Mathematics)
An excellent book to own if you are looking to get into, or want to understand linear algebra. Please keep in mind that you need to have some basic mathematical background before you can use this book.

Linear Algebra Done Right (Undergraduate Texts in Mathematics)
A great book that exposes the method of proof as it used in Linear Algebra. This book is not for the beginner though. You do need some prior knowledge of the basics at least. It would be a good add-on to an existing course you are doing in Linear Algebra.

Linear Algebra, 4th Edition
This is good book …

### The Three Magical Boxes

Q: You are playing a game wherein you are presented 3 magical boxes. Each box has a set probability of delivering a gold coin when you open it. On a single attempt, you can take the gold coin and close the box. In the next attempt you are free to either open the same box again or pick another box. You have a 100 attempts to open the boxes. You do not know what the win probability is for each of the boxes. What would be a strategy to maximize your returns?

Machine Learning: A Probabilistic Perspective (Adaptive Computation and Machine Learning series)

A: Problems of this type fall into a category of algorithms called "multi armed bandits". The name has its origin in casino slot machines wherein a bandit is trying to maximize his returns by pulling different arms of a slot machine by using several "arms". The dilemma he faces is similar to the game described above. Notice, the problem is a bit different from a typical estimation exercise. You co…