Relative Frequency
This type of probability requires us to make some qualifications. We define probability of event A, occurring as the proportion of times A occurs, if we repeat the experiment several times under the same or similar conditions.
Example
Consider the following distribution of salaries in a finance company for February, 2002.
|
Salaries (Rs.)
|
Frequency
|
Relative Frequency (%)
|
|
|
2,000 - 5,000
|
2
|
4%
|
|
5,000 - 8,000
|
11
|
22%
|
|
8,000 - 11,000
|
18
|
36%
|
|
11,000 - 14,000
|
10
|
20%
|
|
14,000 - 17,000
|
7
|
14%
|
|
17,000 - 20,000
|
2
|
4%
|
|
|
50
|
100%
|
|
For a subsequent month the salaries are likely to have the same distributions unless employees leave or have their salaries raised, or new people join. Hence we have the following probabilities obtained from the above relative frequencies.
|
Salaries (Rs.)
|
Probability
|
|
2,000 - 5,000
|
4%
|
|
5,000 - 8,000
|
22%
|
|
8,000 - 11,000
|
36%
|
|
11,000 - 14,000
|
20%
|
|
14,000 - 17,000
|
14%
|
|
17,000 - 20,000
|
4%
|
|
|
100%
|
These probabilities give the chance that an employee chosen at random will be in a particular salary class. For example, the probability of an employee's salary being Rs.5,000 - Rs.8,000 is 22%.