C723 QUANTITATIVE ANALYSIS FOR
BUSINESS PRACTICE SET 2026
PROBABILITY & FORECASTING QUESTIONS
HIGH YIELD A+
◉ The relative frequency approach assigns a numerical value to the
probability based on a formula:
Answer: P(event)=(the number of occurrences of an event/number
of trials)
◉ subjective probability
Answer: determined does not use any formal calculations; instead, it
only reflects the subject's opinions and past experience. For
example, opinion polls are used to predict election results.
◉ Venn diagrams
Answer: are helpful for visualizing events by diagramming all
possible events in the interior of a rectangle.
◉ Two events are mutually exclusive if and only if
Answer: and only if they cannot happen at the same time.
,◉ Probability info
Answer: P(milk) + P(bread) - P(both milk and bread)
=7/15+5/15−2/15=10/15 (or ⅔).
By subtracting the customers that purchased both products you are
eliminating the duplication of those customers.
◉ The union of two events
Answer: is the probability that one or the other event will happen.
◉ marginal probability
Answer: which is an unconditional probability; it is not conditional
on another event occurring.
◉ Joint probability
Answer: The probability of the intersection of the two events is
called joint probability. Joint probability is when both events occur
without any preconditions.
is determining the probability that both events occur.
P(A,B)= ex. (1/6)×(1/6)
, ◉ Conditional probability is the probability of an event occurring
after another event has occurred.
Answer: P(B|A) means "The probability of Event B given Event A"
In other words, event A has already happened; now what is the
probability of event B happening?
◉ stationary time series
Answer: when graphing a series of data points over a period of time
that the data points appear to be independent, or not related to, the
variable of time.
A horizontal pattern fluctuates around a constant mean. There may
be some variation but the data tends to fluctuate around a constant
mean.
◉ A trend is
Answer: the general upward or downward movement of data over a
relatively long period.
◉ A seasonal trend
Answer: is an upward or downward movement in data that repeats
at regular intervals.
BUSINESS PRACTICE SET 2026
PROBABILITY & FORECASTING QUESTIONS
HIGH YIELD A+
◉ The relative frequency approach assigns a numerical value to the
probability based on a formula:
Answer: P(event)=(the number of occurrences of an event/number
of trials)
◉ subjective probability
Answer: determined does not use any formal calculations; instead, it
only reflects the subject's opinions and past experience. For
example, opinion polls are used to predict election results.
◉ Venn diagrams
Answer: are helpful for visualizing events by diagramming all
possible events in the interior of a rectangle.
◉ Two events are mutually exclusive if and only if
Answer: and only if they cannot happen at the same time.
,◉ Probability info
Answer: P(milk) + P(bread) - P(both milk and bread)
=7/15+5/15−2/15=10/15 (or ⅔).
By subtracting the customers that purchased both products you are
eliminating the duplication of those customers.
◉ The union of two events
Answer: is the probability that one or the other event will happen.
◉ marginal probability
Answer: which is an unconditional probability; it is not conditional
on another event occurring.
◉ Joint probability
Answer: The probability of the intersection of the two events is
called joint probability. Joint probability is when both events occur
without any preconditions.
is determining the probability that both events occur.
P(A,B)= ex. (1/6)×(1/6)
, ◉ Conditional probability is the probability of an event occurring
after another event has occurred.
Answer: P(B|A) means "The probability of Event B given Event A"
In other words, event A has already happened; now what is the
probability of event B happening?
◉ stationary time series
Answer: when graphing a series of data points over a period of time
that the data points appear to be independent, or not related to, the
variable of time.
A horizontal pattern fluctuates around a constant mean. There may
be some variation but the data tends to fluctuate around a constant
mean.
◉ A trend is
Answer: the general upward or downward movement of data over a
relatively long period.
◉ A seasonal trend
Answer: is an upward or downward movement in data that repeats
at regular intervals.
