Applications of Probability Theory

Probability theory is widely used in mathematics, statistics, finance, gambling, science,

artificial intelligence or machine learning, computer science, game theory, and philosophy.
It is used to draw inferences about the expected frequency of events. Probability theory is
also used to describe the underlying mechanics and regularities of complex systems.

Probability theory is applied in life, where the life in risk management and in trade on
financial markets It is mostly important for citizens to understand how probability
assessments are made, and how they contribute to decisions. The large insurance
corporations are probably the only corporations that devise their entire business strategy
around probability. Another significant application of probability theory in everyday life
is reliability. Probability and the ability to understand and estimate the likelihood of
any different combination of outcomes versus one another are very important in real life.

In business, probability theory is used in the calculation of long-term gains and losses. This is
how a company whose business is based on risk calculates "probability of profitability" within
acceptable margins. Every decision made in the business world has risk to it. Probability
models can greatly help businesses in optimizing their policies and making safe decisions.
Though complex, these probability methods can increase the profitability and success of a
business.

There are many applications of probability theory in computer science, but the more famous
ones are related to interpreting data and Machine Learning. When it comes to Machine
Learning, they use probability distributions to “calibrate” algorithms, and make the
computer actually approach a desired performance. Probability helps computer scientists
to minimize errors and optimize winning results.

Probability theory is also used in engineering problems such as the reliability of circuits and
systems to statistical methods for hypothesis testing, decision making under uncertainty, and
parameter estimation. Meanwhile, probability theory is used in epidemiology to understand
the relationship between exposures and the risk of health effects.

https://www.iwh.on.ca › what-researchers-mean-by › probability

http://www.iraj.in/journal/journal_file/journal_pdf/14-358-149822091462-64.pdf
https://www.quora.com/What-is-the-application-of-probability-in-computer-science
https://bizfluent.com › Marketing
https://www.slideshare.net/mHashaam67/probability-application-in-business
https://en.wikipedia.org/wiki/Probability