An Outcome Set

In this chapter we will develop the necessary tools for assigning a numerical measure for what is known in conversational language as ‘chance’ such as the chances of winning a lottery, the chances of getting rain on a particular day and so on. There are situations where the results are (1) deterministic (sure), (2) predictable but not deterministic or in other words the results depend upon some chance variation. If a coin is thrown it is not certain whether it will fall on one side’or on the other side because the various factors governing the result of this experiment of throwing a coin are not completely known to us and hence these factors induce a certain element of uncertainty in determining the result. But we know for sure that when a gold coin is thrown in water it sinks because the factors governing the sinking of the coin in water are known to us so that the result of this experiment is deterministic. In statistical theory we are interested in experiments whose results are known but not deterministic.