The Prague Conferences on Information Theory, Statistical Decision Functions, and Random Processes have been organized every three years since 1956. During the eighteen years of their existence the Prague Conferences developed from a platform for presenting results obtained by a small group of researchers into a probabilistic congress, this being documented by the increasing number of participants as well as of presented papers. The importance of the Seventh Prague Conference has been emphasized by the fact that this Conference was held jointly with the eighth European Meeting of Statisticians. This joint meeting was held from August 18 to 23, 1974 at the Technical University of Prague. The Conference was organized by the Institute of Information Theory and Automation of the Czechoslovak Academy of Sciences and was sponsored by the Czechoslovak Academy of Sciences, by the Committee for the European Region of the Institute of Mathematical Statistics, and by the International As sociation for Statistics in Physical Sciences. More than 300 specialists from 25 countries participated in the Conference. In 57 sessions 164 papers (including 17 invited papers) were read, 128 of which are published in the present two volumes of the Transactions of the Conference. Volume A includes papers related mainly to probability theory and stochastic processes, whereas the papers of Volume B concern mainly statistics and information theory.