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Chapter 7
Random Variables and
probabilityy
Discrete p
Distributions
7.2 Random Variables and Probability Distributions
A random variable is a function or rule that
assigns a numerical value to each simple event
in a sample space.
A random variable reflects the aspect of a
random experiment that is of interest for us.
There are two types of random variables:
Discrete random variable
Continuous random variable.
Discrete and Continuous Random Variables
A random variable is discrete if it can assume a
countable number of values.
A random variable is continuous if it can assume an
uncountable number of values.
Discrete random variable Continuous random variable
After the first value is defined
the second value, and any value
thereafter are known.
Therefore, the number of
values is countable
3 ...
After the first value is defined,
any number can be the next one
0 1/16 1/4
1/2
Therefore, the number of
values is uncountable
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Discrete Distributions
In this chapter we will be dealing with discrete,
in the next chapter (8) we will discuss
continuous
Discrete Probability Distribution
A table, formula, or graph that lists all possible
values a discrete random variable can assume,
together with associated probabilities, is called
a discrete probability distribution.
To calculate the probability that the random variable
X assumes the value x, P(X = x),
add the probabilities of all the simple events for which X is
equal to x, or
Use probability calculation tools (tree diagram),
Apply probability definitions
Requirements for a Discrete Distribution
If a random variable can assume values xi,
then the following must be true:
1. 0 p(x i ) 1 for all x i
2.
p( x ) = 1
i
all xi
These are the rules of probability
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Distribution and Relative Frequencies
In practice, often probability distributions are
estimated from relative frequencies.
Example 7.1 on pg. 212
A survey reveals the following frequencies (1,000s) for the
number of color TVs per household.
Number of TVs
0
1
2
3
4
5
Total
Number of Households
1,218
32,379
37,961
19,387
7,714
2,842
101,501
p(x)
0
1
2
3
4
5
1218/Total = .012
.319
.374
.191
.076
.028
1.000
Determining Probability of Events
The probability distribution can be used to
calculate the probability of different events
Example 7.1 continued
Calculate the probability of the following
events:
P(The number of color TVs is 3) = P(X=3) =.191
P(The number of color TVs is two or more) =
P(X2)=P(X=2)+P(X=3)+P(X=4)+P(X=5)=
.374 +.191 +.076 +.028 = .669
P(The number of color TVs is two or less)=
P(X<2)=P(X=2)+P(X=1)+P(X=0)=
.012+.319+ .374=.705
Developing a Probability Distribution
Probability calculation techniques can be used
to develop probability distributions
Example 7.2 on pg. 213
A mutual fund sales person knows that there is 20%
chance of closing a sale on each call she makes.
What is the probability distribution of the number of
sales if she plans to call three customers?
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Developing a Probability Distribution
Solution
Use probability rules and trees
Define event S = {A sale is made}.
P(S)=.2
P(S)=.2
P(SC)=.8
P(S)=.2
SSS
P(SC)=.8
P(S)= 2
P(S)=.2
S S SC
S SC S
P(SC)=.8
P(S)=.2
S SC SC
SC S S
P(SC)=.8
P(S)=.2
SC S SC
SC SC S
P(SC)=.8
SC SC SC
P(SC)=.8
P(S)=.2
P(SC)=.8
(.2)(.2)(.8)= .032
X
3
2
1
0
P(x)
.2
23 = .008
008
3(.032)=.096
3(.128)=.384
.83 = .512
Describing the Population/ Probability Distribution
The probability distribution represents a
population
Were interested in describing the population
by computing various parameters.
Specifically,
Specifically we calculate the population mean
and population variance.
Population Mean (Expected Value)
Given a discrete random variable X with values
xi, that occur with probabilities p(xi), the
population mean of X is.
E( X ) = = x i p( x i )
all xi
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Population Variance
Let
X be a discrete random variable with possible
values xi that occur with probabilities p(xi), and let
E(xi) = . The variance of X is defined by
V ( X ) = 2 = E[( X ) 2 ] = ( x i ) 2 p( x i )
all xi
The s tan dard deviation is
= 2
The Mean and the Variance
Example 7.3 on pg.215
Find the mean the variance and the standard deviation
for the population of the number of color television per
household in example 7.1
Solution
E(X) = = xip(xi) = 0p(0)+1p(1)+2p(2)+=
0(.012)+1(.319)+2(.374)+ = 2.084
V(X) = 2 = (xi - )2p(xi) = (0-2.084)2p(0=.012)+(12.084)2p(1=.319) + (2-2.084)2+ =1.107
Using a shortcut formula
= 1.1071/2 = 1.052
for the variance
The Mean and the Variance
Solution continued
The variance can also be calculated as follows:
V ( X ) = 2 = E( X 2 ) 2 = x i2 p( x i ) 2 =
all xi
[0 p(0) + 1 p(1) + 2 p(2) + ...] 2.084
2
= 1.107
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Laws of Expected Value and Variance
Pg. 216
Laws of Expected Value
Laws of Variance
E(c) = c
E(X + c) = E(X) + c
E(cX) = cE(X)
V(c) = 0
V(X + c) = V(X)
V(cX) = c2V(X)
Question 7.19 - pg. 219 PART A ONLY
Let us try this question now
Question 7.19 - pg. 219
Mean ()
= E(X) = xip(xi)= 0(.4) + 1(.3) + 2(.2) + 3(.1)
= 1.0
(pg. 190)
Variance ( 2 )
= V(X) = (xi- )2 p(xi)
(pg. 190)
= (0-1.0)2(.4) + (1-1.0) 2(.3) + (2-1.0) 2(.2) + (3-1.0) 2(.1)
= 1.0
Standard Deviation ( )
= 2
= 1.0
(pg. 191)
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Question 7.19 - pg. 219 - Extension
From the above distribution/information, find the
following:
1. E(3X)
2. V(3X) 3. E(X + 4)
4. E(4X + 3) 5. V(4X + 3)
Question 7.19 - pg. 201 - Extension
From the above distribution/information, find the following:
1. E(3X)
2. V(3X) 3. E(X + 4)
4. E(4X + 3) 5. V(4X + 3)
1. E(3X) = 3E(X) = 3(1.0) = 3.0
2. V(3X) = 9V(X) = 9(1.00) = 9.00
3. E(X + 4) = E(X) + 4 = 1.0 + 4 = 5.0
4. E(4X + 3) = 4E(X) + 3 = 7.0
5. V(4X + 3) = 16V(X) = 16.0
(EV Rule #3 pg.192)
(V Rule #3 pg. 192)
(EV Rule #2 pg. 192)
(EV Rule #2 & #3 pg. 192)
(V Rule #2 & #3 pg. 192)
7.2 Bivariate Distributions
Please skip sections 7.2 and 7.3 and 7.5
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7.4 The Binomial Distribution
Is a discrete distribution with special properties
The binomial experiment can result in only one
of two possible outcomes.
Typical cases where the binomial experiment
applies:
A coin flipped results in heads or tails
An election candidate wins or loses
An employee is male or female
A car uses 87octane gasoline, or another gasoline.
Binomial Experiment
There are n trials (n is finite and fixed).
Each trial can result in a success or a failure.
The probability p of success is the same for all the
trials.
All the trials of the experiment are independent.
independent
Binomial Random Variable
The binomial random variable counts the number of
successes in n trials of the binomial experiment.
By definition, this is a discrete random variable.
Developing the Binomial Probability Distribution (n = 3)
Since the outcome of each trial is
independent of the previous outcomes,
we can replace the conditional probabilities
S2
with the marginal probabilities.
S1
S3 P(SSS)=p3
F3 P(SSF)=p2(1-p)
S3 P(SFS)=p(1-p)p
P(S2|S1
F2
S2
F3 P(SFF)=p(1-p)2
S3 P(FSS)=(1-p)p2
F3 P(FSF)=(1-p)p(1-p)
S3 P(FFS)=(1-p)2p
F1
F2
F3 P(FFF)=(1-p)3
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Developing the Binomial Probability Distribution (n = 3)
P(SSS)=p
SSS 3
Let X be the number of successes
in three trials. Then,
P(X = 3) = p3
P(X = 2) =
X=3
33p2(1-p)
(1 )
X =22
P(X = 1) = 3p(1-p)2
X=1
P(X = 0) = (1- p)3
X=0
2(1-p)
P(SSF)=p
SS
S S
P(SFS)=p(1-p)p
P(SFF)=p(1-p)2
2
SS
P(FSS)=(1-p)p
P(FSF)=(1-p)p(1-p)
P(FFS)=(1-p)2p
This multiplier is calculated in the following formula
P(FFF)=(1-p)3
Calculating the Binomial Probability
In general, The binomial probability is calculated by:
P( X = x) = p( x) = C nx p x (1 p) nx
where C nx =
n!
x! (n x)!
! Is called a factorial:
If we had 3! it converts to 1 x 2 x 3 = 6
If we had 5! It converts to 1 x 2 x 3 x 4 x 5 = 120
Calculating the Binomial Probability
Example 7.9 & 7.10 on pg. 236 and pg. 237
Pat Statsdud is registered in a statistics course and
intends to rely on luck to pass the next quiz.
The quiz consists of 10 multiple choice questions with 5 possible
choices for each qquestion, onlyy one of which is the correct
answer.
Pat will guess the answer to each question
Find the following probabilities
Pat gets no answer correct (7.9)
Pat gets two answer correct? (7.9)
Pat fails the quiz (7.10)
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Calculating the Binomial Probability
Solution
Checking the conditions
An answer can be either correct or incorrect.
There is a fixed finite number of trials (n=10)
Each answer is independent of the others.
The probability p of a correct answer (.20) does not change
from question to question.
Calculating the Binomial Probability
Solution Continued
Determining the binomial probabilities:
Let X = the number of correct answers
P( X = x) = p( x) = C nx p x (1 p) nx
where C nx =
P( X = 0) =
n!
x! (n x)!
10!
(.20) 0 (.80)10 0 = .1074
0! (10 0)!
Calculating the Binomial Probability
Solution Continued
Determining the binomial probabilities:
Let X = the number of correct answers
P( X = x) = p( x) = C nx p x (1 p) nx
where C nx =
P ( X = 2) =
n!
x! (n x)!
10!
(.20) 2 (.80)10 2 = .3020
2! (10 2)!
10
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Calculating the Binomial Probability
Solution Continued
Determining the binomial probabilities:
Pat fails the test if the number of correct answers is
less than 5, which means less than or equal to 4.
P(X4) = p(0) + p(1) + p(2) + p(3) + p(4)
= .1074 + .2684 + .3020 + .2013 + .0881
=.9672
This is called cumulative probability
Mean and Variance of Binomial Variable
E(X) = = np
V(X) = 2 = np(1-p)
Example 7.11, on pg. 240
If all the students in Pats class intend to guess the
answers to the quiz, what is the mean and the
standard deviation of the quiz mark?
Solution
= np = 10(.2) = 2.
2 = np(1-p) = 10(.2)(.8) = 1.6
= 1.2649
Question 7.90 - pg. 240
We can also solve Binomial problems by using
tables in the back of the text - Appendix B
Table 1
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Using the Tables Question 7.90 - pg. 240
a) P(X = 18)
= P(X < 18) - P(X < 17)
= .659 - .488
= .171
b) P(X = 15)
= P(X < 15) - P(X < 14)
=.189 - .098
= .091
Notice that when
we are solving all
the inequalities
are . This is
b
because
we are
dealing with a
cumulative
distribution table.
Using the Tables Question 7.90 - pg. 240
c) P(X < 20)
= .910
d) P(X > 16)
= 1 - P(X < 15)
= 1 - .189
= .811
Notice that when
we are solving all
the inequalities
are . This is
b
because
we are
dealing with a
cumulative
distribution table.
Poisson Distribution
Please skip this section (7.5)
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