Business Statistics Ch. 4 Probability.ppt

Discrete Probability
Distributions
Israa Hazem Ali
3rd
year
Chapter 4

§ 4.1
Probability
Distributions

Larson & Farber, Elementary Statistics: Picturing the World, 3e 3
Random Variables
A random variable x represents a numerical value
associated with each outcome of a probability distribution.
A random variable is discrete if it has a finite or countable
number of possible outcomes that can be listed.
x
2 10
6
0 4 8
A random variable is continuous if it has an uncountable number or
possible outcomes, represented by the intervals on a number line.
x
2 10
6
0 4 8

Random Variables
Example:
Decide if the random variable x is discrete or continuous.
a.) The distance your car travels on a tank of gas
b.) The number of students in a statistics class
The distance your car travels is a continuous
random variable because it is a measurement that
cannot be counted. (All measurements are
continuous random variables.)
The number of students is a discrete random variable because it can be counted.

Discrete Probability Distributions
A discrete probability distribution lists each possible value the random variable can
assume, together with its probability. A probability distribution must satisfy the following
conditions.
In Words In Symbols
1. The probability of each value of
the discrete random variable is
between 0 and 1, inclusive.
0  P (x)  1
2. The sum of all the probabilities
is 1.
ΣP (x) = 1

Constructing a Discrete Probability Distribution
Guidelines
Let x be a discrete random variable with possible
outcomes x1, x2, … , xn.
1. Make a frequency distribution for the possible
outcomes.
2. Find the sum of the frequencies.
3. Find the probability of each possible outcome by
dividing its frequency by the sum of the frequencies.
4. Check that each probability is between 0 and 1 and
that the sum is 1.

Example:
The spinner below is divided into two sections. The probability of
landing on the 1 is 0.25. The probability of landing on the 2 is 0.75.
Let x be the number the spinner lands on. Construct a probability
distribution for the random variable x.
2
1
0.75
2
0.25
1
P (x)
x
Each probability is
between 0 and 1.
The sum of the probabilities is 1.

Example:
The spinner below is spun two times. The probability of landing on
the 1 is 0.25. The probability of landing on the 2 is 0.75. Let x be the
sum of the two spins. Construct a probability distribution for the
random variable x.
2
1
Continued.
The possible sums are 2, 3, and 4.
P (sum of 2) = 0.25  0.25 = 0.0625
“and”
Spin a 1 on
the first
spin.
Spin a 1 on the
second spin.

Example continued:
2
1
P (sum of 3) = 0.25  0.75 = 0.1875
“and”
Spin a 1 on
the first spin.
Spin a 2 on the
second spin.
“or”
P (sum of 3) = 0.75  0.25 = 0.1875
“and”
Spin a 2 on
the first spin.
Spin a 1 on the
second spin.
3
4
0.0625
2
P (x)
Sum of
spins, x
Continued.
0.375
0.1875 + 0.1875

Example continued:
2
1 P (sum of 4) = 0.75  0.75 = 0.5625
“and”
Spin a 2 on
the first spin.
Spin a 2 on the
second spin.
0.375
3
4
0.0625
2
P (x)
Sum of
spins, x
0.5625
Each probability is between
0 and 1, and the sum of the
probabilities is 1.

Graphing a Discrete Probability Distribution
Example:
Graph the following probability distribution using a histogram.
0.375
3
0.5625
4
0.0625
2
P (x)
Sum of
spins, x
Sum of Two Spins
0
0.4
0.3
0.2
x
Probability
0.6
0.1
0.5
2 3 4
Sum
P(x)

Mean
The mean of a discrete random variable is given by
μ = ΣxP(x).
Each value of x is multiplied by its corresponding
probability and the products are added.
0.0625
2
0.375
3
0.5625
4
P (x)
x
Example:
Find the mean of the probability distribution for the sum of the two spins.
2(0.0625) = 0.125
3(0.375) = 1.125
4(0.5625) = 2.25
xP (x)
ΣxP(x) = 3.5
The mean for the
two spins is 3.5.

Variance
The variance of a discrete random variable is given by
2
= Σ(x – μ)2
P (x).
0.0625
2
0.375
3
0.5625
4
P (x)
x
Example:
Find the variance of the probability distribution for the sum of the two spins. The
mean is 3.5.
–1.5
–0.5
0.5
x – μ
2.25
0.25
0.25
(x – μ)2
 0.141
 0.094
 0.141
P (x)(x – μ)2 ΣP(x)(x – 2)2
The variance for the
two spins is
approximately 0.376
 0.376

Standard Deviation
0.0625
2
0.375
3
0.5625
4
P (x)
x
The standard deviation of a discrete random variable is
given by
Example:
Find the standard deviation of the probability distribution for the sum of the two
spins. The variance is 0.376.
–1.5
–0.5
0.5
x – μ
2
.
σ = σ
2.25
0.25
0.25
(x – μ)2
0.141
0.094
0.141
P (x)(x – μ)2
Most of the sums
differ from the
mean by no more
than 0.6 points.
2
σ σ

0.376 0.613
 

Expected Value
The expected value of a discrete random variable is equal
to the mean of the random variable.
Expected Value = E(x) = μ = ΣxP(x).
Example:
At a raffle, 500 tickets are sold for $1 each for two prizes of $100 and $50. What is
the expected value of your gain?
Your gain for the $100 prize is $100 – $1 = $99.
Your gain for the $50 prize is $50 – $1 = $49.
Write a probability distribution for the possible gains
(or outcomes).
Continued.

Expected Value
P (x)
Gain, x
Example continued:
At a raffle, 500 tickets are sold for $1 each for two prizes of $100 and $50. What is
the expected value of your gain?
Because the expected value is
negative, you can expect to lose
$0.70 for each ticket you buy.
Winning
no prize
1
500
1
500
498
500
$99
$49
–$1
E(x) = ΣxP(x).
1 1 498
$99 $49 ( $1)
500 500 500
      
$0.70


Binomial Experiments
A binomial experiment is a probability experiment that
satisfies the following conditions.
1. The experiment is repeated for a fixed number of
trials, where each trial is independent of other trials.
2. There are only two possible outcomes of interest for
each trial. The outcomes can be classified as a success
(S) or as a failure (F).
3. The probability of a success P (S) is the same for each
trial.
4. The random variable x counts the number of
successful trials.

Notation for Binomial Experiments
Symbol Description
n The number of times a trial is repeated.
p = P (S) The probability of success in a single trial.
q = P (F) The probability of failure in a single trial.
(q = 1 – p)
x The random variable represents a count
of the number of successes in n trials:
x = 0, 1, 2, 3, … , n.

Example:
Decide whether the experiment is a binomial experiment.
If it is, specify the values of n, p, and q, and list the possible
values of the random variable x. If it is not a binomial
experiment, explain why.
• You randomly select a card from a deck of cards, and
note if the card is an Ace. You then put the card
back and repeat this process 8 times.
This is a binomial experiment. Each of the 8 selections represent
an independent trial because the card is replaced before the next
one is drawn. There are only two possible outcomes: either the
card is an Ace or not.
4 1
52 13
p  
8
n  1 12
1
13 13
q    0,1,2,3,4,5,6,7,8
x 

Example:
Decide whether the experiment is a binomial experiment.
If it is, specify the values of n, p, and q, and list the possible
values of the random variable x. If it is not a binomial
experiment, explain why.
• You roll a die 10 times and note the number the die
lands on.
This is not a binomial experiment. While each trial
(roll) is independent, there are more than two possible
outcomes: 1, 2, 3, 4, 5, and 6.

Binomial Probability Formula
In a binomial experiment, the probability of exactly x
successes in n trials is
Example:
A bag contains 10 chips. 3 of the chips are red, 5 of the chips are white, and 2 of the chips are blue. Three
chips are selected, with replacement. Find the probability that you select exactly one red chip.
!
( ) .
( )! !
x n x x n x
n x
n
P x C p q p q
n x x
 
 

1 2
3 1
(1) (0.3) (0.7)
P C

p = the probability of selecting a red chip
3
0.3
10
 
q = 1 – p = 0.7
n = 3
x = 1
3(0.3)(0.49)

0.441


Binomial Probability Distribution
Example:
A bag contains 10 chips. 3 of the chips are red, 5 of the chips are white, and 2 of the chips are blue. Four chips
are selected, with replacement. Create a probability distribution for the number of red chips selected.
p = the probability of selecting a red chip
3
0.3
10
 
q = 1 – p = 0.7
n = 4
x = 0, 1, 2, 3, 4
0.076
3
0.412
1
0.265
2
0.008
4
0.240
0
P (x)
x
The binomial
probability
formula is used
to find each
probability.

Finding Probabilities
Example:
The following probability distribution represents the probability of selecting 0, 1, 2, 3, or 4 red chips
when 4 chips are selected.
a.) P (no more than 3) = P (x  3) = P (0) + P (1) + P (2) + P (3)
0.076
3
0.412
1
0.265
2
0.008
4
0.24
0
P (x)
x
b.) Find the probability of selecting at
least 1 red chip.
a.) Find the probability of selecting no
more than 3 red chips.
= 0.24 + 0.412 + 0.265 + 0.076 = 0.993
b.) P (at least 1) = P (x  1) = 1 – P (0) = 1 – 0.24 = 0.76
Complement

Graphing Binomial Probabilities
Example:
The following probability distribution represents the probability of selecting 0, 1, 2, 3, or 4 red chips when 4
chips are selected. Graph the distribution using a histogram.
0.076
3
0.412
1
0.265
2
0.008
4
0.24
0
P (x)
x
Selecting Red Chips
0
0.4
0.3
0.2
x
Probability
0.1
0.5
0 3
1
Number of red chips
4
2
P (x)

Mean, Variance and Standard Deviation
Population Parameters of a Binomial Distribution
μ np

2
σ npq

σ npq

Mean:
Variance:
Standard deviation:
Example:
One out of 5 students at a local college say that they skip breakfast in the morning. Find the mean,
variance and standard deviation if 10 students are randomly selected.
μ np
 2
σ npq
 σ npq

10(0.2)

2

(10)(0.2)(0.8)

1.6

1.6

1.3

10
n 
1
0.2
5
p  
0.8
q 

§ 4.3
More Discrete
Probability
Distributions

Geometric Distribution
A geometric distribution is a discrete probability
distribution of a random variable x that satisfies the
following conditions.
1. A trial is repeated until a success occurs.
2. The repeated trials are independent of each other.
3. The probability of a success p is constant for each
trial.
The probability that the first success will occur on trial x
is
P (x) = p(q)x – 1
, where q = 1 – p.

Example:
A fast food chain puts a winning game piece on every fifth package of
French fries. Find the probability that you will win a prize,
a.) with your third purchase of French fries,
b.) with your third or fourth purchase of French fries.
p = 0.20 q = 0.80
= (0.2)(0.8)2
= (0.2)(0.64)
= 0.128
a.) x = 3
P (3) = (0.2)(0.8)3 – 1
 0.230
b.) x = 3, 4
P (3 or 4) = P (3) + P (4)
 0.128 + 0.102

Poisson Distribution
The Poisson distribution is a discrete probability distribution of
a random variable x that satisfies the following conditions.
1. The experiment consists of counting the number of times
an event, x, occurs in a given interval. The interval can be
an interval of time, area, or volume.
2. The probability of the event occurring is the same for each
interval.
3. The number of occurrences in one interval is independent
of the number of occurrences in other intervals.
( )
x μ
μ e
P x
x!


The probability of exactly x occurrences in an interval is
where e  2.71818 and μ is the mean number of occurrences.

Poisson Distribution
Example:
The mean number of power outages in the city of Brunswick is 4 per
year. Find the probability that in a given year,
a.) there are exactly 3 outages,
b.) there are more than 3 outages.
3 -4
4 (2.71828)
(3)
3!
P 
4
a ,
.) 3
x
  
0.195

b.) (more than 3)
P
1 [ (3) (2) + (1)+ (0)]
P P P P
  
1 ( 3)
P x
  
1 (0.195 0.147 0.073 0.018)
    
0.567


Business Statistics Ch. 4 Probability.ppt

More Related Content

Similar to Business Statistics Ch. 4 Probability.ppt (20)

More from TeferiGeta2 (20)

Recently uploaded (20)

Business Statistics Ch. 4 Probability.ppt