Probability

&
Probability Distributions

 Prof G R C Nair
 Objectives

Have a quick review of basic concepts of probability

Define the terms random variable, expected value and
probability distribution.
Distinguish between a discrete and continuous
probability distributions.
Calculate the mean, variance, and standard deviation of
a discrete probability distribution.
 What is Probability?

 A quantitative measure of uncertainty

 A measure of the strength of belief in

the occurrence of an uncertain event

 A measure of the degree of chance or

likelihood of occurrence of an
uncertain event.
 A value between 0 and 1.

A value near zero means the

event is not likely to happen. A
value near one means it is quite
likely.
 Definitions

 An experiment is the observation of

some activity / taking some
measurement, having more than one
out come.
 An outcome is the particular result of
an experiment.
 An event is the collection of one or
more outcomes of an experiment.
 Basic Formula
 Probability of an event is calculated as
p=f/N
where,
f = number of favorable out comes for the
event.
N = total number of out comes in the
experiment.
Examples- 53 Sunday in leap year ,King, all
three black balls from 5B&4W balls- 5c3/9c3
 Equally-likely Events

 Throw a die
• Six possible outcomes {1,2,3,4,5,6}

• Since each is equally-likely, the

probability of each is 1/6 = .1667 =
16.67%.

 Probability of each equally-likely

outcome is 1 over the number of
possible outcomes.
 Independent Events

Events are independent if the

occurrence of one event, does not
affect the probability of occurrence
of another event.
 Mutually Exclusive Events

 Events are mutually exclusive if the

occurrence of any one event means
that none of the others can occur at
the same time.
 Collectively Exhaustive
Events

 Events are collectively exhaustive,if they

together exhaust all possible outcomes.
 No other out come is possible.
 So at least one of the events must occur
when an experiment is conducted.
The General Rule of Addition
If A and B are two events that are
not mutually exclusive, then P(A or
B) is given by the following formula:

P(A or B) = P(A) + P(B) - P(A and B)

In a sample of 500 students, 320 said
they had a stereo, 175 said they had a
TV, and 100 said they had both:

TV 175
Both
100

Stereo 320
 If a student is selected at random, what
is the probability that the student has
i) a stereo, ii) a TV, and iii) both stereo
and TV?

P(S) = 320/500 = 0.64

P(T) = 175/500 = 0.35
P(S and T) = 100/500 = 0.20
 iv) what is the probability that the student
has either a stereo or a TV in his or her
room?

 P(S or T) = P(S) + P(T) - P(S and T)

= 0.64 + 0.35 - 0.20 = 0.79

v) what is the probability that the

student has neither?
 Total 500
Both TV
Stereo 100 175
320
Neither-?

500- (320+75) = 105

P = 105/500=0.21
 Joint Probability

A joint probability measures the

likelihood that two or more events will
happen concurrently.
Such concurrent occurrence of a
combination of two or more
elementary or simple events is called
a compound event.
 Multiplication Rule
The special rule of multiplication
requires that two events A and B are
independent.

Two events A and B are independent if the

occurrence of one has no effect on the probability
of the occurrence of the other.
This rule is written: P(A and B) =
P(A)P(B)
eg: toss of coins many times, getting total ten from 2
dice
A person owns two stocks,HLL and
L&T. The probability that HLL stock
will increase in value next year is 0.5
and the probability that L&T stock will
increase in value next year is 0.7.
Assume the two stocks are
independent. What is the probability
that both stocks will increase in value
next year?
P(HLL and L&T)= (0.5)(0.7) =0.35.
 What is the probability that at
least one of these stocks
increase in value during the next
year? (This means that either
one can increase or both.)

P(at least one) = (0.5)(0.3) + (0.5)(0.7)

+(0.7)(0.5) = 0.85.
 Conditional Probability
A conditional probability is the
probability of a particular event
occurring, given that another
event has occurred.
 The probability of the event
A given
that the event B has occurred is
written P(A|B).
 General Multiplication Rule
 The joint probability, P(A and B)
is given by the following formula:

P(A and B) = P(A)P(B/A)

or
P(A and B) =
P(B)P(A/B)
 Bayes’ theorem

 Used to revise probabilities when new

(additional information) concerning a
random experiment is available .
 Gives probability law relating aposterior
probability to apriori probability.
 An event A can occur only if any one of
the set of exhaustive and mutually
exclusive events B1, B2, B3 …..Bn occur.
The probabilities P(B1) , P(B2) ….P(Bn)
and the conditional probability P(A/Bi) for
A to occur are known. Then, the
conditional probability P( Bi/A), when A
has actually occurred, is given by
P(Bi/A) = P(Bi) .P(A/Bi) / {P(B1) . P(A/B1)
+ P(B2) .P(A/B2) +……P(Bn) .P(A/Bn) }
 Probability of A,B or C becoming manager of a
company are 4/9,2/9 and 1/3 respy. The
probability that VRS will be introduced if A,B or
C become manger are 3/10,1/2 and 4/5 respy.
 i. what is the probability that VRS will be
introduced?
 ii. If VRS is introduced, what is the probability
that A has become the manager?
 Ans
 i = 23/45, ii = 6/23
 Random Variables
A random variable is a numerical
value determined by the outcome
of an experiment.

A probability distribution is a graph

showing all possible outcomes of an
experiment and the corresponding
probability.
 Expected value

 Expected value of a random variable is

the sum of the various possible values of
the variable multiplied by the respective
probability of occurrence.
 ie, Expected value E(x)=  x*p(x)
 Types of Probability
Distributions
A discrete probability distribution can
assume only certain definite outcomes.

A continuous probability distribution

can assume an infinite number of values
within a given range.
 Examples of a discrete distribution
are:
 The number of students in a class.
 The number of children in a family.
 The number of cars entering a car
wash in a hour.
 Examples of a continuous distribution
include:
 The distance students travel to class.
 The time it takes an executive to drive
to work.
 The length of an afternoon nap.
 The length of time of a particular
phone call.
Example

Consider a random experiment in

which a coin is tossed three
times. Let x be the number of
heads. Let H represent the
outcome of a head and T the
outcome of a tail.
 The possible outcomes for such an
experiment will be:
TTT, TTH, THT, THH,
HTT, HTH, HHT, HHH.
Thus the possible values of x (number of
heads) are 0,1,2,3.
 The outcome of zero heads occurred once.
ie, probability= 1/8
 The outcome of one head occurred three
times. ie, probability= 3/8
 The outcome of two heads occurred three
times. ie, probability= 3/8
 The outcome of three heads occurred once.
ie, probability= 1/8
 x as defined in this experiment, is a
random variable.
 Its expected value is
(0x1+3x1+3x2+1x3)/8=1.5
 The Mean of a Discrete
Distribution
 The mean:
 reports the central location of the data.
 is the long-run average value of the
random variable.
 is also referred to as its expected
value, E(X), in a probability distribution.
 is a weighted average.
 In the last example , the mean = 1.5
The mean is computed by the
formula:

  [ xP( x)]
 The Variance of a Discrete
Probability Distribution
 The variance measures the amount
of spread (dispersion) of the values
of a distribution.
 The variance of a discrete
distribution is denoted by the Greek
letter  2 (sigma squared).
 The standard deviation is the
square root of variance  2
 The variance of a discrete
probability distribution is
computed from the formula:

2 2
  [( x   ) P( x)]
 Owner of a painting # o f H o u s e s Frequency
Pain t e d
co, studied his /week
10 5
records for the past
20 weeks and 11 6
reports the following 12 7
number of houses
painted per week: 13 2
Probability Distribution:
Number of houses Probability,P(x)
Painted/week, x
10 .25
11 .30
12 .35
13 .10
Total 1.00
 Compute the mean number of
houses painted per week:

  E ( x)  [ xP( x)]
 (10)(.25)  (11)(.30)  (12)(.35)  (13)(.10)
 11 .3
 Compute the Variation and std
deviation of the number of houses
painted per week:

 2  [(x  ) 2 P( x)]
 (10 11.3) 2 (.25)  ...  (13 11.3) 2 (.10)
 0.4225 0.0270 0.1715 0.2890
 0.91
  0.95
 Assignment
 Probability-Page 183, 4-28, 4-29 190 .4-33,
191.4-36,37, 45, 198,206 Levin
 From IIMM Text-Page 680-683
 Distributions- Page 236 . 5-17