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Deduction or Induction?

Elementary My Dear Watson

1 min readAug 7, 2020

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Latin roots of the two words mean: ‘leading from’ and ‘leading in’. Deduction forms the basis of classical logic, while induction is the foundation of scientific method.

Deductive reasoning begins with a general truth/hypothesis and leads to a knowledge of a particular instance of it. The classic form is a SYLLOGISM, in which a necessary conclusion is derived from two accepted premises.

‘If all cows are ruminants, and Bossy is a cow, it follows that Bossy chews her cud.’

Induction begins with the particular and moves to the universal (a generalization that accounts for other examples of the same category or class). It relies on observation and experimentation.

‘In the case of Bossy, it can be demonstrated that she digests by rumination; if all the other cows we observe do likewise, we can declare, if not a certainty then a high probability, that cud chewing is a distinguishing feature of all cows.’

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Business Modeling
Business Modeling

Published in Business Modeling

Models allowing you to Read a Business Like a Book!

Jakub Smrček
Jakub Smrček

Written by Jakub Smrček

Qualitative investment analysis is about understanding a business before taking out your calculator. This blog teaches you how to do it for common stocks.

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