Issue 5 of Think Before You Act
Perhaps you recognised the assignment from the last lesson: If you toss a coin fifteen times and you get heads every time, what is the probability of getting tails the next time?
It is fifty percent. Unless there is something wrong with the coin, that is.
You probably knew this. But still it might feel unintuitive. Especially if you know that the probability of getting heads sixteen times in a row is a mere 0,0015%.
Probabilities is something that is far from intuitive for many people. You might have learned how it works in school but it still "feels" wrong. Therefore it might be a good idea to sometimes revisit what you learned about probabilities from school. In the case of coin tossing, the thing that might confuse you is your knowledge of the fifteen preceding coin tosses and the fact that it's really improbable that you would get sixteen heads in a row. It's really like this: The more coins you toss, over time you will get heads in fifty percent of the cases on average. Don't forget the "on average" part! You might get one hundred heads in a row, but the overall share of heads from your tossing will get closer and closer to 50% the more you toss. This is the law of big numbers:
With this we leave statistics. Can you solve the problem below?
A recent update from the Swedish Companies Registration Office states that the number of companies in Sweden has increased with 5 000 during September. A politician immediately writes an article about this and says that there is a clear inequality problem in Swedish entrepreneurship. 100% of the increase comes from company with only male board members!
The same day you can read in another newspaper that female entrepreneurship is soaring in Sweden: Companies lead by women stand for 100% of the increase in new companies!
And actually, they are both right. How can that be? Please note: There are at least two explanations.
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Think Before You Act
This course is for everyone who sometimes need to make decisions based on facts and want to avoid jumping to the wrong conclusions. You will learn about common thought traps in science, mathematics and human reasoning, and how to avoid them. Among other things, the course will teach you:
- How to become pregnant from kisses
- Why almost nothing has been scientifically proven
- How you can reach the conclusion that 150% of new companies are run by chauvinists
- Why you should never look at the right side of a restaurant menu
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Jens Bäckbom is a tech entrepreneur from Stockholm with a MSc in Finance and and MSc in Engineering Physics. He is a passionate learner and is especially found of mathematical modelling.Subscribe now