Prior Distributions

Example:

Let (theta) theta denote the probability of obtaining a head in a coin toss, and assume it is known the coin is either fair (has a head side and a tail side, and each is expected to be observed with similar frequency over many, many trials) or unfair in that it has a head on each side. The possible values of
theta
are
theta = 1/2
and
theta = 1
.