Discrete Probability Distributions
Mean, Variance, & Standard Deviation of Discrete Distributions
Formulae
μ = E (x) = Σ[x * P (x)]
Where
E(x) = long-run average
x = an outcome
P(x) = probability of that outcome
σ 2 = Σ [(x−μ )2 ∗ P(x)]
where
σ2 = variance
x = an outcome
P(x) = probability of a given outcome
μ = mean
Standard Deviation
σ = √ Σ[(x−μ )2 ∗ P(x)]
where
σ = variance
x = an outcome
P(x) = probability of a given outcome
μ = mean
Page 1 of 6
Discrete Probability Distributions
The following table lists the probability distribution of the number of breakdowns per week
for a machine based on past data. Find the mean number of breakdowns per week for this
machine. Also find the variance and standard deviation
Breakdowns per week 0 1 2 3
Probability 0.15 0.20 0.35 0.30
μ = E (x) = Σ[x * P (x)]
= 1.80
Interpretation
On an average, this machine is expected to break down 1.80 times per week over a period
of time. If this machine is used for many weeks, then for certain weeks we will observe no
breakdowns; for some other weeks we will observe one breakdown per week; and for still
other weeks we will observe two or three breakdowns per week.
σ 2 = Σ [(x−μ )2 ∗ P(x)]
= 1.06
σ = √ Σ[(x−μ )2 ∗ P(x)]
= 1.03
The following data are the result of a historical study of the number of flaws found in a
porcelain cup produced by a manufacturing firm. Use these data and the associated
probabilities to compute the expected number of flaws and the standard deviation of flaws.
Sol: 0.956, 1.1305
Flaws 0 1 2 3 4
Probability 0.461 0.285 0.129 0.087 0.038
Page 2 of 6
Discrete Probability Distributions
Binomial Distribution
Formulae
μ=n*p
E(x) = n * p
σ2 = n.p .q
σ = √n .p .q
where
µ=E(x) = Expected value
σ2 = variance
σ = standard deviation
n = the number of trials (or the number being sampled)
p = the probability of getting a success in one trial
q = 1 - p = the probability of getting a failure in one trial
n
r (n−r)
P( x=r) = Cr X p X q
n!
= X pr X q(n−r)
[r !(n−r) !]
where
n = the number of trials (or the number being sampled)
r = the number of successes desired
p = the probability of getting a success in one trial
q = 1 - p = the probability of getting a failure in one trial
Page 3 of 6
Discrete Probability Distributions
1. A survey found that 65% of all financial consumers were very satisfied with their primary
financial institution. If 25 financial consumers are sampled, what is the probability that
exactly 19 are very satisfied with their primary financial institution?
2. A recent survey indicates that 20% of the companies that outsource overseas use a
consultant. If 15 companies that outsource overseas are randomly selected.
a. What is the probability that exactly 5 companies that outsource overseas use a
consultant?
b. What is the probability that none of the companies that outsource overseas use a
consultant?
c. What is the probability that between four and seven (inclusive) companies that
outsource overseas use a consultant?
Ans. a. 0.1032 b. 0.0352 c. 0.3480
3. In an Accountemps survey of senior executives, 30% of the senior executives said that it
is appropriate for job candidates to ask about compensation and benefits during the first
interview (USA TODAY, April 13, 2009). Suppose that this result holds true for the current
population of senior executives in the United States. A random sample of six senior
executives is selected. Find
a. Probability that exactly three senior executives in this sample hold the said opinion.
b. Probability that none of the senior executives in this sample hold the said opinion.
c. Probability that at the most / not more than two senior executives in this sample
hold the said opinion.
d. Probability that two or less senior executives in this sample hold the said opinion.
e. Probability that fewer than / lesser than two senior executives in this sample hold
the said opinion.
f. Probability that at least three senior executives in this sample hold the said
opinion.
g. Probability that 1 to 3 senior executives in this sample hold the said opinion.
h. Probability that more than three senior executives in this sample hold the said
opinion.
i. The expected value or the long-run average, variance and standard deviation
Ans: a. 0.185 b. 0.118 c. 0.744 d. 0.744 e. 0.420 f. 0.256 g. 0.812
i μ = E(x) = n * p = 6 * 0.30 = 1.8
2
σ = n.p .q σ = √ n .p .q
2
σ = 6∗0.30∗0.70 σ = √ 1.26
2
σ = 1.26 σ = 1.12
Page 4 of 6
Discrete Probability Distributions
Poisson Distribution
Formulae
x −m
m e
P( x) =
x!
where
x = 0, 1, 2, 3, . . . the number of occurrences per interval for which the probability is
being computed
m = long-run average
e = 2.718282
μ=m
σ2 = m
σ=√m
where
m = long-run average
Page 5 of 6
Discrete Probability Distributions
1. Bank customers arrive randomly on weekday afternoons at an average of 3.2 customers
every 4 minutes. What is the probability of exactly 5 customers arriving in a 4-minute
interval on a weekday afternoon?
2. A bank has an average random arrival rate of 3.2 customers every 4 minutes. What is
the probability of getting exactly 10 customers during an 8-minute interval?
3. On average, two new accounts are opened per day at an Imperial Savings Bank branch.
Find the probability that on a given day the number of new accounts opened at this bank
will be
a. exactly 6
b. at the most 3
c. at the most 1
d. at least 4
e. Find the expected value or the long-run average, variance and standard deviation
e. μ = E(x) = m = 2
2
σ = m
σ2 = 2
2
σ = √σ
σ = √2
σ = 1.414
Page 6 of 6
