This document discusses Bayes' theorem and provides two examples to illustrate it.
In the first example, the document calculates the probability that a patient has cancer given a positive screening test result using Bayes' theorem. It finds the probability is 43.11%.
The second example calculates the probability that a malpractice suit originated from Hospital 1 given that a suit was filed. Using Bayes' theorem, it determines the probability is 13.89%.
Both examples construct hypothetical frequency tables to provide an intuitive understanding of how to calculate the conditional probabilities required by Bayes' theorem.
This document discusses Bayes' theorem and provides two examples to illustrate it.
In the first example, the document calculates the probability that a patient has cancer given a positive screening test result using Bayes' theorem. It finds the probability is 43.11%.
The second example calculates the probability that a malpractice suit originated from Hospital 1 given that a suit was filed. Using Bayes' theorem, it determines the probability is 13.89%.
Both examples construct hypothetical frequency tables to provide an intuitive understanding of how to calculate the conditional probabilities required by Bayes' theorem.
This document discusses Bayes' theorem and provides two examples to illustrate it.
In the first example, the document calculates the probability that a patient has cancer given a positive screening test result using Bayes' theorem. It finds the probability is 43.11%.
The second example calculates the probability that a malpractice suit originated from Hospital 1 given that a suit was filed. Using Bayes' theorem, it determines the probability is 13.89%.
Both examples construct hypothetical frequency tables to provide an intuitive understanding of how to calculate the conditional probabilities required by Bayes' theorem.
This document discusses Bayes' theorem and provides two examples to illustrate it.
In the first example, the document calculates the probability that a patient has cancer given a positive screening test result using Bayes' theorem. It finds the probability is 43.11%.
The second example calculates the probability that a malpractice suit originated from Hospital 1 given that a suit was filed. Using Bayes' theorem, it determines the probability is 13.89%.
Both examples construct hypothetical frequency tables to provide an intuitive understanding of how to calculate the conditional probabilities required by Bayes' theorem.
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Cancer Screening
Objective To illustrate Bayes' Theorem.
Definitions: Given: C = event that the patient has cancer Experience shows that 3 percent of the patients who are given a screening C' = event that the patient has no cancer test actually have cancer. If a patient has cancer, the test will yield a positive T = event that the screening test is positive result 98% of the time and a negative result 2% of the time (a "false negative"). If a patient has no cancer, the test will yield a negative result T' = event that the screening test is negative 96% of the time, and a positive result 4% of the time (a "false positive").
Given (in symbolic form):
Question: P(C) = 0.03 Þ P(C') = 0.97 Suppose the test is positive. What is the probability P(T|C) = 0.98 Þ P(T'|C) = 0.02 that the patient actually has cancer? P(T|C’) = 0.04 Þ P(T'|C') = 0.96
Method 1: Bayes' Theorem:
Bayes' Theorem says: Comment P(Cancer | Positive Test) = P(Positive Test | Cancer) P(Cancer) / P(Positive Test) P(C|P) is lower than P(Positive Test) = P(Positive Test | Cancer) P(Cancer) + P(Positive Test | No Cancer) P(No Cancer) you might expect. P(Positive Test) = (0.98)(0.03) + (0.04)(0.97) = .0294 + .0388 = 0.0682 So P(Cancer | Positive Test) = (0.98)(0.03)/( 0.0682) = (0.0294)/(0.0682) = 0.4311 or 43.11%
Method 2: Create a hypothetical frequency table
Construct a hypothetical table of frequencies assuming 10,000 Definitions: patients. Then P(Cancer | Positive Test) = 294 / 682 = 0.4311 C = event that the patient has cancer C' = event that the patient has no cancer T = event that the screening test is positive Positive Test (T) Negative Test (T') Row Total T' = event that the screening test is negative Cancer (C) 294 6 300 No Cancer (C') 388 9,312 9,700 Given (in symbolic form): Col Total 682 9,318 10,000 P(C) = 0.03 Þ P(C') = 0.97 P(T|C) = 0.98 Þ P(T'|C) = 0.02 P(T|C’) = 0.04 Þ P(T'|C') = 0.96 The Bottom Line Bayes' formula is the "right" way to do this type of problem, yet many people feel that Bayes' formula is a Table Frequencies little hard to understand. The table method offers an 0.03 x 10,000=300 0.97 x 10,000 = 9700 appealing heuristic. 0.98 x 300= 294 0.02 x 300 = 6 0.04 x 9,700=388 0.96 x 9,700 = 9,312 Hospital Litigation Objective To illustrate Bayes' Theorem. Definitions: Given: M = event that a malpractice suit is filed Three hospitals centers have 50%, 30% and 20% of the patients, M' = event that a malpractice suit is not filed respectively. Experience shows that malpractice suits are filed with H1 = event that the case is from hospital 1 respective probabilities of .001, .005, and .008. H2 = event that the case is from hospital 2 H3 = event that the case is from hospital 3
Question: Given (in symbolic form):
If a malpractice suit is filed, what is the P(H1) = 0.50 P(M | H1) = 0.001 probability that it originated in hospital 1? P(H2) = 0.30 P(M | H2) = 0.005 P(H1) = 0.20 P(M | H3) = 0.008 Method 1: Bayes' Theorem: Bayes Theorem says: P(H1 | M) = P(M | H1) P(H1) / S P(M | Hj) P(Hj) P(H1 | M) = P(M | H1) P(H1) / [ P(M | H1) P(H1) + P(M | H2) P(H2) + P(M | H3) P(H3) ] P(H1 | M) = (0.001)(0.50) / [ (0.001)(0.50) + (0.005)(0.30) + (0.008)(0.20) ] P(H1 | M) = 0.0005 / [ 0.0005 + 0.0015 + 0.0016 ] P(H1 | M) = 0.0005 / 0.0036 P(H1 | M) = 0.1389 or 13.89%
Method 2: Create a hypothetical frequency table Definitions:
Construct a hypothetical table of frequencies assuming 10,000 patients. Then M = event that a malpractice suit is filed P(Hospital 1 | Malpractice Suit Filed) =P(H1 | M) = 5/36 = 0.1389 M' = event that a malpractice suit is not filed H1 = event that the case is from hospital 1 H2 = event that the case is from hospital 2 H3 = event that the case is from hospital 3 Malpractice Suit (M) No Malpractice Suit (M') Row Total Hospital 1 (H1) 5 4,995 5,000 Hospital 2 (H2) 15 2,985 3,000 Hospital 3 (H3) 16 1,984 2,000 Given (in symbolic form): 36 9,964 10,000 P(H1) = 0.50 P(M | H1) = 0.001 P(H2) = 0.30 P(M | H2) = 0.005 The Bottom Line P(H1) = 0.20 P(M | H3) = 0.008 Comment Bayes' formula is the "right" way to do this type of problem, but many people feel that Bayes' formula is a little hard to understand. The table method is a heuristic method with Table Frequencies intuitive appeal. 0.50 x 10,000=5000 0.001 x 5,000 = 5 0.30 x 10,000=3000 0.005 x 3,000 = 15 0.20 x 10,000=2000 0.008 x 2,000 = 16
