Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and ...

A tree diagram is a visual means of representing complex processes or problems in a hierarchical structure. It is made up of nodes and branches, where the nodes represent a problem’s elements and the ...

For any event that has multiple outcomes with different probabilities, it can be helpful and illustrative to construct a chart or diagram of the possible outcomes. Tree diagrams are a useful example ...

We elaborate on an alternative representation of conditional probability to the usual tree diagram. We term the representation “turtleback diagram” for its resemblance to the pattern on turtle shells.

Venn diagrams are used to sort sets of data. The probability of an event not happening uses the complement of the region on the Venn diagram. Count the number of elements in each region. Redraw the ...

In decision modeling with influence diagrams, the most challenging task is probability elicitation from domain experts. It is usually very difficult for experts to directly assign precise ...