In the context of a non-deterministic view of the world, probability is a number which reflects the degree of confidence someone has that a given statement or event is true, based on the information they have. Probability and probability calculus, on the other hand, are essential tools for those who wish to recognise uncertainty and manage it responsibly.
This presentation of subjective probability (the only one possible) will enable even those who are not experts to acquire the correct knowledge of an instrument which is essential and necessary for dealing with the world around us.
The text takes only one hour to read, but it will help you to avoid many mistakes and enable you to understand the origin of those you might have made in the past.
The reader will also be able to appreciate many funny examples and paradoxes such as this one: statistics tell us that 20% of motorway car accidents are caused by drivers with high blood alcohol levels. It can then be derived that 80% of accidents are caused by sober drivers. Therefore, we should supply alcohol to those who drive on motorways!
Paolo Manca professor of Probability Calculus and Chair of Financial Mathematics at the University of Pisa, Director of the Masters Program of Finance and Financial Markets, currently works as a financial consultant, specialized in derivative valuations and savings protection. He is president of the association cerfidi (Centro Studi di Finanza e Diritto) and author of numerous publications in financial economics.