A client asked me recently a fun probability question, which revolved around figuring out the probability of success of a research program. In a simplified form, here is the problem: imagine that you have multiple labs, each developing products which have independent probabilities of succeeding – what is the probability of more than a certain number of products being eventually successful?

Let’s illustrate on a simple example. Product A has a 30% probability of success, and product B a 60% probability of success. Combining these into a probability tree, we work out that there is an 18% chance of having 2 products successful, 18% + 12 % + 42% = 72% chance of having 1 or more products succeed, and 28% chances of a total failure.

It’s not a very complicated theoretical problem. Practically, however, when the number of products increases, the number of outcomes becomes large, fairly fast – and working out every single combination by hand is extremely tedious.

Fortunately, using a simple trick, we can generate these combinations with minimal effort. The representation of integers in base 2 is a decomposition in powers of 2, resulting in a unique sequence of 0 and 1. In our simplified example, if we consider the numbers 0, 1, 2 and 3, their decomposition is

0 = 0 x 2^2 + 0 x 2^1 –> 00

1 = 0 x 2^2 + 1 ^ 2^1 –> 01

2 = 1 x 2^2 + 0 x 2^1 –> 10

3 = 1 x 2^2 + 1 x 2^2 –> 11

As a result, if if consider a 1 to encode the success of a product, and a 0 its failure, the binary representation of integers from 0 to 3 gives us all possible outcomes for our two-products scenario.

More...

## Comments

- Create an Excel chart in C# without worksheet data (3)
- Read Excel VBA macros and functions through C# (30)
- Using FSI to execute F# code from a .NET app (8)
- Excel ScatterPlot with labels, colors and markers (29)

Comment RSSgopro hero 4 release date 2014 wrote: All the different styles of Chaco adventure sandal... [More]

identity theft protection tips wrote: Hello! I could have sworn I've been to this site b... [More]

Dave Thomas wrote: If anyones interested I wrote a couple of article ... [More]

Ron wrote: Mathias, That was just what I was looking for. T... [More]