Probability

5 Probability Questions Every Quant Interview Asks

Reversing conditional probabilities: priors, likelihoods, posteriors, and the medical test puzzle.

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What to remember

  • Bayes reverses conditionals: P(A|B) = P(B|A)P(A)/P(B), with P(B) via total probability.
  • Base rates dominate for rare events: 99% accurate test on 1% prevalence → only 50% posterior.
  • Posterior ∝ likelihood × prior; updating chains naturally over time.
Read the lessonBayes' Theorem, with a checkpoint at the end.