Blog Home / Financial Terms / Mutually Exclusive Events

Mutually Exclusive Events

If two events cannot occur at the same time, they are mutually exclusive. Imagine the possible outcomes of one die roll.

What are Mutually Exclusive Events?

Two events are mutually exclusive if they cannot both happen. Consider the possible outcomes of one roll of a die. The events:

  1. x = an even number”
  2. x = 3 are mutually exclusive
  3. cannot both happen on the same roll

Example of mutually exclusive events:

P(A or B) = P(A) + P(B) − P(AB).

When events A and B are mutually exclusive,

P(AB)=0, so P(A or B) = P(A) + P(B).

Owais Siddiqui
1 min read
Related:
Financial TermsFRM
What is Standard Deviation?
Owais Siddiqui 19 September 2022
Financial TermsFRM
Hedging,Types and Importance
Owais Siddiqui 19 September 2022
Financial TermsFRM
What is Hedging?
Owais Siddiqui 19 September 2022
Financial TermsFRM
Variance
Owais Siddiqui 19 September 2022
Financial TermsFRM
What is Probability?
Ajinkya Gawande 20 September 2022

Shares

Leave a comment

Your email address will not be published.