Discrete Probabilities Distributions

Rajendra Desai, SJCBA, 2013

Slide 1

Random Variables
A random variable is a numerical description of the outcome of an experiment.
A discrete random variable may assume either a finite number of values or an infinite sequence of values. A continuous random variable may assume any numerical value in an interval or collection of intervals.

Rajendra Desai, SJCBA, 2013

Slide 2

Example: JSL Appliances

Discrete random variable with a finite number of values Let x = number of TVs sold at the store in one day, where x can take on 5 values (0, 1, 2, 3, 4)

Rajendra Desai, SJCBA, 2013

Slide 3

Example: JSL Appliances

Discrete random variable with an infinite sequence of values Let x = number of customers arriving in one day, where x can take on the values 0, 1, 2, . . .

We can count the customers arriving, but there is no finite upper limit on the number that might arrive.

Rajendra Desai, SJCBA, 2013

Slide 4

Random Variables
Question Random Variable x x = Number of dependents in family reported on tax return Type Discrete Continuous Discrete

Family size

Distance from x = Distance in miles from home to store home to the store site

Own dog or cat

x = 1 if own no pet; = 2 if own dog(s) only; = 3 if own cat(s) only; = 4 if own dog(s) and cat(s)

Rajendra Desai, SJCBA, 2013

Slide 5

Discrete Probability Distributions

The probability distribution for a random variable describes how probabilities are distributed over the values of the random variable. We can describe a discrete probability distribution with a table, graph, or equation.

Rajendra Desai, SJCBA, 2013

Slide 6

Discrete Probability Distributions

The probability distribution is defined by a probability function, denoted by f(x), which provides the probability for each value of the random variable. The required conditions for a discrete probability function are: f(x) > 0 f(x) = 1

Rajendra Desai, SJCBA, 2013

Slide 7

Example: JSL Appliances

Using past data on TV sales, a tabular representation of the probability distribution for TV sales was developed. Units Sold 0 1 2 3 4 Number of Days 80 50 40 10 20 200 x 0 1 2 3 4 f(x) .40 .25 .20 .05 .10 1.00
80/200

Rajendra Desai, SJCBA, 2013

Slide 8

Example: JSL Appliances

Graphical Representation of the Probability Distribution .50

Probability
.40

.30 .20 .10 0 1 2 3 4

Slide 9

Values of Random Variable x (TV sales)

Rajendra Desai, SJCBA, 2013

Discrete Uniform Probability Distribution

The discrete uniform probability distribution is the simplest example of a discrete probability distribution given by a formula. The discrete uniform probability function is

f(x) = 1/n

where: n = the number of values the random variable may assume

the values of the random variable are equally likely

Rajendra Desai, SJCBA, 2013

Slide 10

Expected Value and Variance

The expected value, or mean, of a random variable is a measure of its central location. E(x) = = xf(x) The variance summarizes the variability in the values of a random variable. Var(x) = 2 = (x - )2f(x)

The standard deviation, , is defined as the positive square root of the variance.
Rajendra Desai, SJCBA, 2013 Slide 11

Example: JSL Appliances

Expected Value of a Discrete Random Variable x 0 1 2 3 4 f(x) xf(x) .40 .00 .25 .25 .20 .40 .05 .15 .10 .40 E(x) = 1.20

expected number of TVs sold in a day

Rajendra Desai, SJCBA, 2013 Slide 12

Example: JSL Appliances

Variance and Standard Deviation of a Discrete Random Variable x

0 1 2 3 4

x-
-1.2 -0.2 0.8 1.8 2.8

(x - )2
1.44 0.04 0.64 3.24 7.84

f(x)
.40 .25 .20 .05 .10

(x - )2f(x)
.576 .010 .128 .162 .784

Variance of daily sales = 2 = 1.660

TVs squared

Standard deviation of daily sales = 1.2884 TVs

Rajendra Desai, SJCBA, 2013 Slide 13

Binomial Probability Distribution

Four Properties of a Binomial Experiment 1. The experiment consists of a sequence of n identical trials.

2. Two outcomes, success and failure, are possible on each trial.

3. The probability of a success, denoted by p, does not change from trial to trial.

4. The trials are independent.

Rajendra Desai, SJCBA, 2013

Slide 14

Binomial Probability Distribution

Our interest is in the number of successes occurring in the n trials. We let x denote the number of successes occurring in the n trials.

Rajendra Desai, SJCBA, 2013

Slide 15

Binomial Probability Distribution

Binomial Probability Function

n! f (x) p x (1 p)( n x ) x !(n x )!

where: f(x) = the probability of x successes in n trials n = the number of trials p = the probability of success on any one trial

Rajendra Desai, SJCBA, 2013

Slide 16

Binomial Probability Distribution

Binomial Probability Function

n! f (x) p x (1 p)( n x ) x !(n x )!

n! x !(n x )!
Number of experimental outcomes providing exactly x successes in n trials

p (1 p)
x

(nx )

Probability of a particular sequence of trial outcomes with x successes in n trials

Rajendra Desai, SJCBA, 2013

Slide 17

Example: Ecs Electronics

Binomial Probability Distribution Ecs is concerned about a low retention rate for employees. In recent years, management has seen a turnover of 10% of the hourly employees annually. Thus, for any hourly employee chosen at random, management estimates a probability of 0.1 that the person will not be with the company next year.

Rajendra Desai, SJCBA, 2013

Slide 18

Example: Ecs Electronics

Binomial Probability Distribution Choosing 3 hourly employees at random, what is the probability that 1 of them will leave the company this year?

Let: p = .10, n = 3, x = 1

n! f ( x) p x (1 p ) (n x ) x !( n x )!
3! f (1) (0.1)1 (0.9)2 3(.1)(.81) .243 1!(3 1)!

Rajendra Desai, SJCBA, 2013

Slide 19

Example: Ecs Electronics

Tree Diagram
1st Worker 2nd Worker 3rd Worker L (.1) S (.9) L (.1) Stays (.9) S (.9) Leaves (.1) Stays (.9) Stays (.9) L (.1) S (.9) L (.1)

x
3 2

Leaves (.1)
Leaves (.1)

Prob. .0010 .0090

2
1 2 1 1 0

.0090
.0810 .0090

.0810
.0810 .7290
Slide 20

S (.9)
Rajendra Desai, SJCBA, 2013

Using Excel to Compute Binomial Probabilities

Formula Worksheet
A 1 2 3 4 5 6 7 8 9 B 3 = Number of Trials (n ) 0.1 = Probability of Success (p ) f (x ) =BINOMDIST(A5,$A$1,$A$2,FALSE) =BINOMDIST(A6,$A$1,$A$2,FALSE) =BINOMDIST(A7,$A$1,$A$2,FALSE) =BINOMDIST(A8,$A$1,$A$2,FALSE)

x 0 1 2 3

Rajendra Desai, SJCBA, 2013

Slide 21

Using Excel to Compute Binomial Probabilities

Value Worksheet
A 1 2 3 4 5 6 7 8 9 B 3 = Number of Trials (n ) 0.1 = Probability of Success (p ) f (x ) 0.729 0.243 0.027 0.001

x 0 1 2 3

Rajendra Desai, SJCBA, 2013

Slide 22

Using Excel to Compute Cumulative Binomial Probabilities

Formula Worksheet
A 1 2 3 4 5 6 7 8 9 B 3 = Number of Trials (n ) 0.1 = Probability of Success (p ) Cumulative Probability =BINOMDIST(A5,$A$1,$A$2,TRUE) =BINOMDIST(A6,$A$1,$A$2,TRUE) =BINOMDIST(A7,$A$1,$A$2,TRUE) =BINOMDIST(A8,$A$1,$A$2,TRUE)

x 0 1 2 3

Rajendra Desai, SJCBA, 2013

Slide 23

Using Excel to Compute Cumulative Binomial Probabilities

Value Worksheet
A 1 2 3 4 5 6 7 8 9 B 3 = Number of Trials (n ) 0.1 = Probability of Success (p ) Cumulative Probability 0.729 0.972 0.999 1.000

x 0 1 2 3

Rajendra Desai, SJCBA, 2013

Slide 24

Binomial Probability Distribution

Expected Value E(x) = = np

Variance
Var(x) = 2 = np(1 p)

Standard Deviation

np(1 p)

Rajendra Desai, SJCBA, 2013

Slide 25

Binomial Probability Distribution

Binomial Probability Distribution Expected Value

E(x) = = 3(.1) = .3 employees out of 3

Variance
Var(x) = 2 = 3(.1)(.9) = .27

Standard Deviation
3(.1)(.9) .52 employees

Rajendra Desai, SJCBA, 2013

Slide 26

Poisson Probability Distribution

A Poisson distributed random variable is often useful in estimating the number of occurrences over a specified interval of time or space It is a discrete random variable that may assume an infinite sequence of values (x = 0, 1, 2, . . . ).

Rajendra Desai, SJCBA, 2013

Slide 27

Poisson Probability Distribution

Examples of a Poisson distributed random variable:
the number of knotholes in 24 feet of a wooden board the number of vehicles arriving at a toll booth in one hour

Rajendra Desai, SJCBA, 2013

Slide 28

Poisson Probability Distribution

Two Properties of a Poisson Experiment

1. The probability of an occurrence is the same

for any two intervals of equal length.

2. The occurrence or nonoccurrence in any

interval is independent of the occurrence or nonoccurrence in any other interval.

Rajendra Desai, SJCBA, 2013

Slide 29

Poisson Probability Distribution

Poisson Probability Function

f ( x)

x e
x!

where: f(x) = probability of x occurrences in an interval = mean number of occurrences in an interval e = 2.71828

Rajendra Desai, SJCBA, 2013

Slide 30

Example : Mercy Hospital

Poisson Probability Function Patients arrive at the emergency room of Mercy Hospital at the average rate of 6 per hour on weekend evenings.

What is the probability of 4 arrivals in 30 minutes on a weekend evening?

Rajendra Desai, SJCBA, 2013

Slide 31

Example: Mercy Hospital

Poisson Probability Function

= 6/hour = 3/half-hour, x = 4
34 (2.71828)3 f (4) .1680 4!

Rajendra Desai, SJCBA, 2013

Slide 32

Using Excel to Compute Poisson Probabilities

Formula Worksheet
A 1 2 B 3 = Mean No. of Occurrences ( )

Number of 3 Arrivals (x ) 4 0 5 1 6 2 7 3 8 4 9 5 10 6

Probability f (x ) =POISSON(A4,$A$1,FALSE) =POISSON(A5,$A$1,FALSE) =POISSON(A6,$A$1,FALSE) =POISSON(A7,$A$1,FALSE) =POISSON(A8,$A$1,FALSE) =POISSON(A9,$A$1,FALSE) =POISSON(A10,$A$1,FALSE)

and so on
Rajendra Desai, SJCBA, 2013

and so on
Slide 33

Using Excel to Compute Poisson Probabilities

Value Worksheet
A 1 2 B 3 = Mean No. of Occurrences ( )

Number of 3 Arrivals (x ) 4 0 5 1 6 2 7 3 8 4 9 5 10 6

Probability f (x ) 0.0498 0.1494 0.2240 0.2240 0.1680 0.1008 0.0504

and so on
Rajendra Desai, SJCBA, 2013

and so on
Slide 34

Example: Mercy Hospital

Poisson Distribution of Arrivals

Poisson Probabilities
0.25

Probability

0.20
0.15 0.10 0.05 0.00

actually, the sequence continues: 11, 12,

0
1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

Rajendra Desai, SJCBA, 2013 Slide 35

Using Excel to Compute Cumulative Poisson Probabilities

Formula Worksheet
A 1 2 B 3 = Mean No. of Occurrences ( )

Number of 3 Arrivals (x ) 4 0 5 1 6 2 7 3 8 4 9 5 10 6

Cumulative Probability =POISSON(A4,$A$1,TRUE) =POISSON(A5,$A$1,TRUE) =POISSON(A6,$A$1,TRUE) =POISSON(A7,$A$1,TRUE) =POISSON(A8,$A$1,TRUE) =POISSON(A9,$A$1,TRUE) =POISSON(A10,$A$1,TRUE)

and so on
Rajendra Desai, SJCBA, 2013

and so on
Slide 36

Using Excel to Compute Cumulative Poisson Probabilities

Value Worksheet
A 1 2 B 3 = Mean No. of Occurrences ( )

Number of 3 Arrivals (x ) 4 0 5 1 6 2 7 3 8 4 9 5 10 6

Cumulative Probability 0.0498 0.1991 0.4232 0.6472 0.8153 0.9161 0.9665

and so on
Rajendra Desai, SJCBA, 2013

and so on
Slide 37

Variance of Poisson Distributions

A property of the Poisson distribution is that the mean and variance are equal.
=2

Variance for Number of Arrivals during 30-Minute Periods

=2=3

Rajendra Desai, SJCBA, 2013

Slide 38