I'm constantly getting my conversations marked off because I'm not writing exactly what the teacher wants. Here is the question that was asked in class and my answer to the question:

In your own words, describe what conditional probability is. Consider a business problem you are familiar with. Can you apply conditional probabilities to gain a better understanding of it? Try to provide an example.

My response:

Professor/Class:

In my own words, which I haven't been very successful at, I would say that conditional probabilities are where an outcome/event has already occurred.

In a business scenario (which I hope my words come across appropriately) lets say that there are two companies that invoices are processed for and out of those invoices we already know that 80% (A) of invoices are processed within an appropriate time limit. If you have 60% more invoices received from a different company are given, what is the conditional probability of both events?

The formula to be used would be P(A/B) (A + B)/P(A) = .80/.60 = .48

Since we already know that the event A was already occurred we then find out the amount within the B event to find the conditional probability.

Reference:

State Yale University. (1998). Conditional probability. Retrieved from http://www.stat.yale.edu/Courses/1997-98/101/condprob.htm