Final answer:
The fallacies related to overlooking prior probabilities, such as the gambler's fallacy and the availability heuristic, stem from cognitive biases or induction errors, resulting in skewed views of event probabilities.
Step-by-step explanation:
Fallacies associated with overlooking prior probabilities often arise from cognitive biases or induction errors. One example is the gambler's fallacy, an erroneous belief that if something happens less frequently in the past, it will happen more frequently in the future in chance events. Despite past results, each chance event is independent, like a coin flip offering equal probability of heads or tails regardless of previous outcomes. The availability heuristic is another fallacy related to prior probability, where individuals make a judgment based on the most easily recalled instances, instead of all relevant data. This leads to skewed views of probability based on memorable or recent examples.
Confirmation bias further compounds these fallacies by causing individuals to focus on evidence that confirms existing beliefs, while ignoring evidence that contradicts those beliefs. These biases and heuristics demonstrate the importance of considering proper statistical methods and the full scope of available data when estimating probabilities and making decisions.