Baye’s theorem:-

Suppose we have estimated prior probabilities for events we are concerned with, and then obtain a new information. We would like to have a sound method to computer revised or posterior probabilities. Baye’s theorem gives us a way to do this.

That is, estimating the prayer probabilities for events the individual is concerned with and obtain the new information regarding it. The individual will take a computer revised or posterior probabilities. Then, Baye’s theorem gives us the way to do this.

Probability revision using Baye’s theorem:-

Applications of baye’s theorem:-

• Consider a manufacturing firm that receive shipment of parts from two suppliers.

• Let a denote event that the part is received from Supplier 1, A2 is received from supplier 2.

For example:-

We get 65% of our parts from suppliers 1 and we get 35% of some supplier 2 .

Thus,

P(A1)=0.65 and p(A2)=0.35