Normal +Bionomial

80
Probability Distribution Random variables Discrete Continuous Applications Binomial Tables Applications

Transcript of Normal +Bionomial

Page 1: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 180

Probability Distribution

Random variables

Discrete

Continuous

Applications

Binomial Tables Applications

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 280

AA random variablerandom variable is a numerical description of theis a numerical description of theoutcome of an experimentoutcome of an experimentAA

random variablerandom variable is a numerical description of theis a numerical description of theoutcome of an experimentoutcome of an experiment

Random VariablesRandom Variables

AA discrete random variablediscrete random variable may assume either amay assume either a

finite number of values or an infinite sequence of finite number of values or an infinite sequence of valuesvalues

AA discrete random variablediscrete random variable may assume either amay assume either a

finite number of values or an infinite sequence of finite number of values or an infinite sequence of valuesvalues

AA continuous random variablecontinuous random variable may assume anymay assume any

numerical value in an interval or collection of numerical value in an interval or collection of intervalsintervals

AA continuous random variablecontinuous random variable may assume anymay assume any

numerical value in an interval or collection of numerical value in an interval or collection of intervalsintervals

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 380

LetLet x x = number of TVs sold at the store in one day= number of TVs sold at the store in one day

wherewhere x x can take on 5 values (0 1 2 3 4)can take on 5 values (0 1 2 3 4)

Le

tLet x x = number of TVs sold at the store in one day= number of TVs sold at the store in one day

wherewhere x x can take on 5 values (0 1 2 3 4)can take on 5 values (0 1 2 3 4)

Example JSL Appliances

Discrete random variable with a finite number of values

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 480

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

Example JSL AppliancesExample JSL Appliances

s Discrete random variable with anDiscrete random variable with an infiniteinfinite

sequence of valuessequence of values

We can count the customers arriving but there is noWe can count the customers arriving but there is no

finite upper limit on the number that might arrivefinite upper limit on the number that might arrive

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 580

Random VariablesRandom Variables

QuestionQuestion Random VariableRandom Variable x x TypeType

FamilyFamily

sizesize

x x = Number of dependents= Number of dependents

reported on tax returnreported on tax returnDiscreteDiscrete

Distance fromDistance fromhome to storehome to store

x x = Distance in miles from= Distance in miles fromhome to the store sitehome to the store site

ContinuousContinuous

Sell anSell an

automobileautomobile Gender of the customer Gender of the customer

x x = 0 if male= 0 if male= 1 if female= 1 if female

DiscreteDiscrete

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 680

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 780

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

Discrete Probability DistributionsDiscrete Probability Distributions

f f (( x x )) gtgt 00f f (( x x )) gtgt 00

ΣΣ f f (( x x ) = 1) = 1ΣΣ f f (( x x ) = 1) = 1

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 2: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 280

AA random variablerandom variable is a numerical description of theis a numerical description of theoutcome of an experimentoutcome of an experimentAA

random variablerandom variable is a numerical description of theis a numerical description of theoutcome of an experimentoutcome of an experiment

Random VariablesRandom Variables

AA discrete random variablediscrete random variable may assume either amay assume either a

finite number of values or an infinite sequence of finite number of values or an infinite sequence of valuesvalues

AA discrete random variablediscrete random variable may assume either amay assume either a

finite number of values or an infinite sequence of finite number of values or an infinite sequence of valuesvalues

AA continuous random variablecontinuous random variable may assume anymay assume any

numerical value in an interval or collection of numerical value in an interval or collection of intervalsintervals

AA continuous random variablecontinuous random variable may assume anymay assume any

numerical value in an interval or collection of numerical value in an interval or collection of intervalsintervals

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 380

LetLet x x = number of TVs sold at the store in one day= number of TVs sold at the store in one day

wherewhere x x can take on 5 values (0 1 2 3 4)can take on 5 values (0 1 2 3 4)

Le

tLet x x = number of TVs sold at the store in one day= number of TVs sold at the store in one day

wherewhere x x can take on 5 values (0 1 2 3 4)can take on 5 values (0 1 2 3 4)

Example JSL Appliances

Discrete random variable with a finite number of values

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 480

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

Example JSL AppliancesExample JSL Appliances

s Discrete random variable with anDiscrete random variable with an infiniteinfinite

sequence of valuessequence of values

We can count the customers arriving but there is noWe can count the customers arriving but there is no

finite upper limit on the number that might arrivefinite upper limit on the number that might arrive

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 580

Random VariablesRandom Variables

QuestionQuestion Random VariableRandom Variable x x TypeType

FamilyFamily

sizesize

x x = Number of dependents= Number of dependents

reported on tax returnreported on tax returnDiscreteDiscrete

Distance fromDistance fromhome to storehome to store

x x = Distance in miles from= Distance in miles fromhome to the store sitehome to the store site

ContinuousContinuous

Sell anSell an

automobileautomobile Gender of the customer Gender of the customer

x x = 0 if male= 0 if male= 1 if female= 1 if female

DiscreteDiscrete

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 680

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 780

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

Discrete Probability DistributionsDiscrete Probability Distributions

f f (( x x )) gtgt 00f f (( x x )) gtgt 00

ΣΣ f f (( x x ) = 1) = 1ΣΣ f f (( x x ) = 1) = 1

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 3: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 380

LetLet x x = number of TVs sold at the store in one day= number of TVs sold at the store in one day

wherewhere x x can take on 5 values (0 1 2 3 4)can take on 5 values (0 1 2 3 4)

Le

tLet x x = number of TVs sold at the store in one day= number of TVs sold at the store in one day

wherewhere x x can take on 5 values (0 1 2 3 4)can take on 5 values (0 1 2 3 4)

Example JSL Appliances

Discrete random variable with a finite number of values

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 480

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

Example JSL AppliancesExample JSL Appliances

s Discrete random variable with anDiscrete random variable with an infiniteinfinite

sequence of valuessequence of values

We can count the customers arriving but there is noWe can count the customers arriving but there is no

finite upper limit on the number that might arrivefinite upper limit on the number that might arrive

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 580

Random VariablesRandom Variables

QuestionQuestion Random VariableRandom Variable x x TypeType

FamilyFamily

sizesize

x x = Number of dependents= Number of dependents

reported on tax returnreported on tax returnDiscreteDiscrete

Distance fromDistance fromhome to storehome to store

x x = Distance in miles from= Distance in miles fromhome to the store sitehome to the store site

ContinuousContinuous

Sell anSell an

automobileautomobile Gender of the customer Gender of the customer

x x = 0 if male= 0 if male= 1 if female= 1 if female

DiscreteDiscrete

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 680

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 780

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

Discrete Probability DistributionsDiscrete Probability Distributions

f f (( x x )) gtgt 00f f (( x x )) gtgt 00

ΣΣ f f (( x x ) = 1) = 1ΣΣ f f (( x x ) = 1) = 1

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 4: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 480

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

LetLet x x = number of customers arriving in one day= number of customers arriving in one day

wherewhere x x can take on the values 0 1 2 can take on the values 0 1 2

Example JSL AppliancesExample JSL Appliances

s Discrete random variable with anDiscrete random variable with an infiniteinfinite

sequence of valuessequence of values

We can count the customers arriving but there is noWe can count the customers arriving but there is no

finite upper limit on the number that might arrivefinite upper limit on the number that might arrive

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 580

Random VariablesRandom Variables

QuestionQuestion Random VariableRandom Variable x x TypeType

FamilyFamily

sizesize

x x = Number of dependents= Number of dependents

reported on tax returnreported on tax returnDiscreteDiscrete

Distance fromDistance fromhome to storehome to store

x x = Distance in miles from= Distance in miles fromhome to the store sitehome to the store site

ContinuousContinuous

Sell anSell an

automobileautomobile Gender of the customer Gender of the customer

x x = 0 if male= 0 if male= 1 if female= 1 if female

DiscreteDiscrete

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 680

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 780

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

Discrete Probability DistributionsDiscrete Probability Distributions

f f (( x x )) gtgt 00f f (( x x )) gtgt 00

ΣΣ f f (( x x ) = 1) = 1ΣΣ f f (( x x ) = 1) = 1

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 5: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 580

Random VariablesRandom Variables

QuestionQuestion Random VariableRandom Variable x x TypeType

FamilyFamily

sizesize

x x = Number of dependents= Number of dependents

reported on tax returnreported on tax returnDiscreteDiscrete

Distance fromDistance fromhome to storehome to store

x x = Distance in miles from= Distance in miles fromhome to the store sitehome to the store site

ContinuousContinuous

Sell anSell an

automobileautomobile Gender of the customer Gender of the customer

x x = 0 if male= 0 if male= 1 if female= 1 if female

DiscreteDiscrete

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 680

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 780

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

Discrete Probability DistributionsDiscrete Probability Distributions

f f (( x x )) gtgt 00f f (( x x )) gtgt 00

ΣΣ f f (( x x ) = 1) = 1ΣΣ f f (( x x ) = 1) = 1

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 6: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 680

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

The The probability distribution

probability distribution for a random variablefor a random variabledescribes how probabilities are distributed overdescribes how probabilities are distributed over

the values of the random variablethe values of the random variable

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

We can describe a discrete probability distributionWe can describe a discrete probability distributionwith a table graph or equationwith a table graph or equation

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 780

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

Discrete Probability DistributionsDiscrete Probability Distributions

f f (( x x )) gtgt 00f f (( x x )) gtgt 00

ΣΣ f f (( x x ) = 1) = 1ΣΣ f f (( x x ) = 1) = 1

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 7: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 780

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The probability distribution is defined by a The probability distribution is defined by aprobability functionprobability function denoted by denoted by f f (( x x ) which provides) which provides

the probability for each value of the random variablethe probability for each value of the random variable

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

The required conditions for a discrete probability The required conditions for a discrete probabilityfunction arefunction are

Discrete Probability DistributionsDiscrete Probability Distributions

f f (( x x )) gtgt 00f f (( x x )) gtgt 00

ΣΣ f f (( x x ) = 1) = 1ΣΣ f f (( x x ) = 1) = 1

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 8: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 880

s a tabular representation of the probabilitya tabular representation of the probabilitydistribution for TV sales was developeddistribution for TV sales was developed

s Using past data on TV sales hellipUsing past data on TV sales hellip

NumberNumber

Units SoldUnits Sold of Daysof Days00 8080

11 5050

22 4040

33 101044 2020

200200

x x f f (( x x ))00 4040

11 2525

22 2020

33 050544 1010

100100

8020080200

Discrete Probability DistributionsDiscrete Probability Distributions

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 9: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 980

1010

2020

3030

4040

5050

0 1 2 3 40 1 2 3 4

Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)Values of Random VariableValues of Random Variable x x (TV sales)(TV sales)

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

P r o

b a

b i l i t

y

Discrete Probability DistributionsDiscrete Probability Distributions

Graphical Representation of Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 10: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1080

xpec e a ue anVariance

The The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central locationThe The expected valueexpected value or mean of a random variable or mean of a random variableis a measure of its central locationis a measure of its central location

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The variancevariance summarizes the variability in thesummarizes the variability in the

values of a random variablevalues of a random variable

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

The The standard deviationstandard deviation σ σ is defined as the positive is defined as the positive

square root of the variancesquare root of the variance

Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))Var(Var( x x ) =) = σ σ 22 == ΣΣ (( x x -- micro micro ))22f f (( x x ))

EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))EE(( x x ) =) = micro micro == ΣΣ xf xf (( x x ))

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 11: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1180

Expected Value

expected numberexpected number

of TVs sold in a dayof TVs sold in a dayexpected numberexpected number

of TVs sold in a dayof TVs sold in a day

x x f f (( x x )) xf xf (( x x ))

00 4040 0000

11 2525 2525

22 2020 4040

33 0505 1515

44 1010 4040

EE(( x x ) = 120) = 120

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 12: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1280

Variance and Standard Deviation

00

1122

33

44

-12-12

-02-020808

1818

2828

144144

004004064064

324324

784784

4040

2525

2020

0505

1010

576576

010010

128128

162162

784784

x - x - micro micro (( x - x - micro micro ))22 f f (( x x )) (( x x -- micro micro ))22f f (( x x ))

Variance of daily sales =Variance of daily sales = σ σ 22 = 1660= 1660

x x

TVs TVs

squaresquare

dd

Standard deviation of daily sales = 12884 TVsStandard deviation of daily sales = 12884 TVs

xpec e a ue anVariance

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 13: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1380

Continuous Probability Distributions

Uniform Probability Distribution

Normal Probability Distribution Normal Approximation of Binomial Probabilities

Exponential Probability Distribution

f ( x )f ( x )

x x

UniformUniform

x x

f f (( x x ))NormalNormal

x x

f ( x )f ( x ) ExponentialExponential

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 14: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1480

Continuous Probability Distributions

s AA continuous random variablecontinuous random variable can assume anycan assume any

value in an interval on the real line or in avalue in an interval on the real line or in acollection of intervalscollection of intervals

s It is not possible to talk about the probabilityIt is not possible to talk about the probability

of the random variable assuming a particularof the random variable assuming a particular

valuevalues Instead we talk about the probability of theInstead we talk about the probability of the

random variable assuming a value within arandom variable assuming a value within a

given intervalgiven interval

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 15: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1580

Continuous Probability DistributionsContinuous Probability Distributions

s The probability of the random variable The probability of the random variable

assuming a value within some given intervalassuming a value within some given intervalfromfrom x x 11 toto x x 22 is defined to be theis defined to be the area underarea under

the graphthe graph of theof the probability density functionprobability density function betweenbetween x x

11 andand x x 22

f ( x )f ( x )

x x

UniformUniform

x x 11 x x 11 x x 22 x x 22

x x

f f (( x x ))NormalNormal

x x 11 x x 11 x x 22 x x 22

x x 11 x x 11 x x 22 x x 22

ExponentialExponential

x x

f ( x )f ( x )

x x 11

x x 11

x x 22 x x 22

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 16: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1680

n orm ro a yDistribution

wherewhere aa = smallest value the variable can assume= smallest value the variable can assume

bb = largest value the variable can assume= largest value the variable can assume

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 1() = 1(bb ndashndash aa) for) for aa ltlt x x ltlt bb

= 0 elsewhere= 0 elsewhere

s A random variable isA random variable is uniformly distributeduniformly distributed

whenever the probability is proportional to thewhenever the probability is proportional to theintervalrsquos lengthintervalrsquos length

s The The uniform probability density functionuniform probability density function isis

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 17: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1780

Var(Var( x x ) = () = (bb -- aa))221212Var(Var( x x ) = () = (bb -- aa))221212

E(E( x x ) = () = (aa ++ bb)2)2E(E( x x ) = () = (aa ++ bb)2)2

n orm ro a yDistributions Expected Value of Expected Value of x x

s Variance of Variance of x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 18: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1880

n orm ro a yDistributions Example Slaters BuffetExample Slaters Buffet

Slater customers are charged for theSlater customers are charged for theamount of amount of

salad they take Sampling suggests that thesalad they take Sampling suggests that theamountamount

of salad taken is uniformly distributedof salad taken is uniformly distributedbetween 5between 5

ounces and 15 ouncesounces and 15 ounces

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 19: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 1980

s Uniform Probability Density FunctionUniform Probability Density Function

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

f f (( x x ) = 110 for 5) = 110 for 5 ltlt x x ltlt 1515

= 0 elsewhere= 0 elsewhere

wherewhere

x x = salad plate filling weight= salad plate filling weight

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 20: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2080

s Expected Value of Expected Value of x x

s Variance of Variance of x x

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

E(E( x x ) = () = (aa ++ bb)2)2

= (5 + 15)2= (5 + 15)2

= 10= 10

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Var(Var( x x ) = () = (bb -- aa))221212

= (15 ndash 5)= (15 ndash 5)22

1212= 833= 833

Uniform Probability DistributionUniform Probability Distribution

n orm ro a

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 21: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2180

Uniform Probability Distribution

for Salad Plate Filling Weight

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

n orm ro a yDistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 22: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2280

f ( x )f ( x )

x x 55 1010 1515

110110

Salad Weight (oz)Salad Weight (oz)

P(12 lt x lt 15) = (110)(3) = 3P(12 lt x lt 15) = (110)(3) = 3

What is the probability that a customerWhat is the probability that a customer

will take between 12 and 15 ounces of will take between 12 and 15 ounces of

saladsalad

1212

Uniform Probability DistributionUniform Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 23: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2380

Two major difference between the continuous random

variables and their discrete counterparts

bull We can take out probability of the random variable

assuming a value within a given interval but probability of

the random variable assuming a particular value cannot findout

bull Probability of a continuous random variable assuming any

particular value exactly is zero Because the area under the

graph of f(x) at a single point is zero

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 24: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2480

orma ro a yDistribution The normal probability distribution is the most important distribution for

describing a continuous random variable It is widely used in statistical inference

It is also known as Gaussion distribution

s It has been used in a wide variety of It has been used in a wide variety of

applicationsapplicationsbull Heights of peopleHeights of people

bull Scientific measurementsScientific measurements

bull Test scores Test scores

bull Amounts of rainfallAmounts of rainfall

orma ro a y

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 25: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2580

orma ro a yDistributionNormal Probability Density Function

2 2( ) 21( )

2

x f x e micro σ

σ π

minus minus

=

micro micro = mean= mean

σ σ = standard deviation= standard deviation

π π = 314159= 314159

ee = 271828= 271828

wherewhere

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 26: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2680

The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero The distribution is The distribution is symmetricsymmetric its skewness its skewness

measure is zeromeasure is zero

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 27: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2780

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

The entire family of normal probability The entire family of normal probability

distributions is defined by itsdistributions is defined by its meanmean micro micro and itsand its

standard deviationstandard deviation σ σ

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

Standard DeviationStandard Deviation σ σ

MeanMean micro micro x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 28: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2880

The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode The The highest pointhighest point on the normal curve is at theon the normal curve is at the

meanmean which is also the which is also the medianmedian andand modemode

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 29: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 2980

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

-10-10 00 2020

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

The mean can be any numerical value negative The mean can be any numerical value negative

zero or positivezero or positive

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 30: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3080

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

σ = 15= 15

σ = 25= 25

The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves The standard deviation determines the width of the The standard deviation determines the width of the

curve larger values result in wider flatter curvescurve larger values result in wider flatter curves

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 31: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3180

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Probabilities for the normal random variable areProbabilities for the normal random variable are

given bygiven by areas under the curveareas under the curve The total area The total area

under the curve is 1 (5 to the left of the mean andunder the curve is 1 (5 to the left of the mean and

5 to the right)5 to the right)

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

55 55

x x

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 32: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3280

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

6826682668266826

+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation+- 1 standard deviation

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

of values of a normal random variableof values of a normal random variableare within of its meanare within of its mean

9544954495449544+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations+- 2 standard deviations

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

of values of a normal random variableof values of a normal random variable

are within of its meanare within of its mean

9972997299729972

+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations+- 3 standard deviations

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 33: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3380

Normal Probability DistributionNormal Probability Distribution

s CharacteristicsCharacteristics

x x micro micro ndashndash 33σ σ micro micro ndashndash 11σ σ

micro micro ndashndash 22σ σ

micro micro + 1+ 1σ σ

micro micro + 2+ 2σ σ

micro micro + 3+ 3σ σ micro micro

68266826

95449544

99729972

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 34: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3480

Standard Normal ProbabilityDistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

A random variable having a normal distributionA random variable having a normal distributionwith a mean of 0 and a standard deviation of 1 iswith a mean of 0 and a standard deviation of 1 is

said to have asaid to have a standard normal probabilitystandard normal probability

distributiondistribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 35: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3580

σ σ = 1= 1

00

z z

The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable The letter The letter z z is used to designate the standardis used to designate the standardnormal random variablenormal random variable

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 36: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3680

s Converting to the Standard NormalConverting to the Standard Normal

DistributionDistribution

Standard Normal Probability DistributionStandard Normal Probability Distribution

z x

=

minus micro

σ

We can think of We can think of z z as a measure of the number of as a measure of the number of standard deviationsstandard deviations x x is fromis from micro micro

Standard Normal Density FunctionStandard Normal Density Function

Standard Normal Probability

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 37: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3780

Standard Normal ProbabilityDistribution

s Example Pep ZoneExample Pep Zone

Pep Zone sells auto parts and suppliesPep Zone sells auto parts and supplies

includingincluding

a popular multi-grade motor oil When thea popular multi-grade motor oil When the

stock of stock of

this oil drops to 20 gallons a replenishmentthis oil drops to 20 gallons a replenishment

order isorder is

placedplaced

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 38: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3880

The store manager is concerned that sales The store manager is concerned that sales

are beingare being

lost due to stockouts while waiting for an orderlost due to stockouts while waiting for an order

It haIt ha

been determined that demand duringbeen determined that demand during

replenishmentreplenishment

lead-time is normally distributed with a mean of lead-time is normally distributed with a mean of

1515

gallons and a standard deviation of 6 gallonsgallons and a standard deviation of 6 gallons

The manager would like to know the The manager would like to know the

probability of probability of

a stockouta stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

s Example Pep ZoneExample Pep Zone

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 39: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 3980

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

z z = (= ( x x -- micro micro ))σ σ

= (20 - 15)6= (20 - 15)6= 83= 83

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distributionStep 1 ConvertStep 1 Convert x x to the standard normal distributionto the standard normal distribution

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

Step 2 Find the area under the standard normalStep 2 Find the area under the standard normal

curve to the left of curve to the left of z z = 83= 83

see next slidesee next slide see next slidesee next slide

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 40: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4080

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)

= 05- 2967= 05- 2967

= 2033= 2033

PP(( z z gt 83) = 05 ndashgt 83) = 05 ndash PP(( z z ltlt 83)83)= 05- 2967= 05- 2967

= 2033= 2033

s Solving for the Stockout ProbabilitySolving for the Stockout Probability

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

Step 3 Compute the area under the standard normalStep 3 Compute the area under the standard normal

curve to the right of curve to the right of z z = 83= 83

ProbabilityProbabilityof a stockoutof a stockout PP(( x x gt 20)gt 20)

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 41: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4180

Standard Normal Probability Distribution

If the manager of Pep Zone wants the

probability of a stockout to be no more than

05 what should the reorder point be

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 42: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4280

s Solving for the Reorder PointSolving for the Reorder Point

00

Area = 9500Area = 9500

Area = 0500Area = 0500

z z z z

0505

Standard Normal Probability DistributionStandard Normal Probability Distribution

d d l b bili i ib iS d d N l P b bili Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 43: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4380

s Solving for the Reorder PointSolving for the Reorder Point

Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x Step 2 ConvertStep 2 Convert z z 0505 to the corresponding value of to the corresponding value of x x

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

x x == micro micro ++ z z 0505 σ σ

= 15 + 1645(6)= 15 + 1645(6)

= 2487 or 25= 2487 or 25

A reorder point of 25 gallons will place the probabilityA reorder point of 25 gallons will place the probabilityof a stockout during leadtime at (slightly less than) 05of a stockout during leadtime at (slightly less than) 05

Standard Normal Probability DistributionStandard Normal Probability Distribution

S d d l b bili i ib iSt d d N l P b bilit Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 44: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4480

s Solving for the Reorder PointSolving for the Reorder Point

By raising the reorder point from 20 gallons toBy raising the reorder point from 20 gallons to

25 gallons on hand the probability of a stockout25 gallons on hand the probability of a stockout

decreases from about 20 to 05decreases from about 20 to 05

This is a significant decrease in the chance that Pe This is a significant decrease in the chance that Pep

Zone will be out of stock and unable to meet aZone will be out of stock and unable to meet acustomerrsquos desire to make a purchasecustomerrsquos desire to make a purchase

Standard Normal Probability DistributionStandard Normal Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 45: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4580

Introduction and Concept

Based on Bernoulli Process

Is a discrete-time stochastic process consisting of a sequence of independent

random variables taking values over two symbols

We are not dealing with samples but with population values so dealing withparameters

Consider tossing a coin twice The possible outcomes are

no heads P (m = 0) = q2

one head P (m = 1) = qp + pq (toss 1 is a tail toss 2 is a head or toss 1 is head toss 2 is a tail) = 2 pq

two heads P(m = 2) = p2

Now recalling square of Binomial (p + q) is equal to the same as if added

above

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 46: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4680

Characteristics

Experiment consist of n identical trials

Each trial has only two outcomes

The probability of one outcome is p and the other is q=1-p

The probability stays the same from one trail to the next

The trials are statistically independent

We are interested in r the number of success observed during

the n trials

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 47: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4780

Binomial Formula

Binomial distribution the probability of r success out of N trials

( ) r N r r N r N

r

r N r

r N q pr N r

N q pq pC p N r P minusminusminus

minus===

)(

)(

Expectation Value micro = np = 50 13 = 16667

000

002

004

006

008

010

012

014

0 5 10 15 20 25 3k

P

( k

5 0

1 3 )

Expectation Value

micro = np = 7 13 = 2333

000

010

020

030

040

0 2 4 6 8 10k

P

( k

7

1 3 )

Bi i l Di t ib tiBi i l Di t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 48: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4880

wherewhere f f (( x x ) = the probability of ) = the probability of x x successes insuccesses in nn trialstrials

nn = the number of trials= the number of trials

p p = the probability of success on any one trial= the probability of success on any one trial

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial Probability FunctionBinomial Probability Function

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 49: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 4980

Binomial Formulas

Mean

Standard Deviation

( )

( ) ( )

( ) ( ) ( )

Np

p p N p

p pm p p p p N q pm p

pm N pq pm

q p p

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

N

m

m N m N m

=

minusminussdotminus=

sum minusminusminussum minusminus=sum

=sum minusminusminussum

=

sum

minusminusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minusminus

=

minus

micro

micro micro

part

part

111

0

1

0

1

0

1

0

1

0

1

0

)1(1)1(

)1()1()1()1(

0)1)((

0

σ 2=

(mminus micro )2P(m N p)m=0

N

sum

P(m N p)m=0

N

sum

=Npq

Bi i l Di t ib tiBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 50: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5080

( )( ) (1 )

( ) x n x n

f x p p x n x

minus= minusminus

Binomial DistributionBinomial Distribution

s Binomial ProbabilityBinomial Probability

FunctionFunction

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Probability of a particularProbability of a particular

sequence of trial outcomessequence of trial outcomes

withwith x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Number of experimentalNumber of experimental

outcomes providing exactlyoutcomes providing exactly

x x successes insuccesses in nn trialstrials

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 51: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5180

Binomial DistributionBinomial Distribution

s Example Evans ElectronicsExample Evans Electronics

Evans is concerned about a low retentionEvans is concerned about a low retentionrate for employees In recent yearsrate for employees In recent years

management has seen a turnover of 10 of management has seen a turnover of 10 of

the hourly employees annually Thus for anythe hourly employees annually Thus for any

hourly employee chosen at randomhourly employee chosen at randommanagement estimates a probability of 01management estimates a probability of 01

that the person will not be with the companythat the person will not be with the company

next yearnext year

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 52: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5280

Binomial DistributionBinomial Distribution

s Using the Binomial Probability FunctionUsing the Binomial Probability Function

Choosing 3 hourly employees at randomChoosing 3 hourly employees at randomwhat is the probability that 1 of them will leavewhat is the probability that 1 of them will leave

the company this yearthe company this year

f xn

x n x p p x n x( )

( )( )( )

=

minus

minusminus1

1 23(1) (01) (09) 3(1)(81) 2431(3 1)f = = =

minus

LetLet p p = 10= 10 nn = 3= 3 x x = 1= 1

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 53: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5380

Tree Diagram

Binomial Distribution

1st Worker1st Worker 2nd Worker2nd Worker 3rd Worker3rd Worker x x ProbProb

Leaves

(1)

Leaves

(1)

Stays(9)

Stays(9)

33

22

00

22

22

Leaves (1)Leaves (1)

Leaves (1)Leaves (1)

S (9)S (9)

Stays (9)Stays (9)

Stays (9)Stays (9)

S (9)S (9)

S (9)S (9)

S (9)S (9)

L (1)L (1)

L (1)L (1)

L (1)L (1)

L (1)L (1) 00100010

00900090

00900090

72907290

00900090

11

11

08100810

08100810

08100810

1111

Binomial DistributionBinomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 54: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5480

s Using Tables of Binomial ProbabilitiesUsing Tables of Binomial Probabilities

n x 05 10 15 20 25 30 35 40 45 50

3 0 8574 7290 6141 5120 4219 3430 2746 2160 1664 1250

1 1354 2430 3251 3840 4219 4410 4436 4320 4084 3750

2 0071 0270 0574 0960 1406 1890 2389 2880 3341 3750

3 0001 0010 0034 0080 0156 0270 0429 0640 0911 1250

p

Binomial DistributionBinomial Distribution

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 55: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5580

Binomial Distribution

(1 )np pσ = minus

EE(( x x ) =) = micro micro == npnpEE(( x x ) =) = micro micro == npnp

Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))Var(Var( x x ) =) = σ σ 22

== npnp(1(1 minusminus p p))

s ExpectedExpected

ValueValue

s VariancVarianc

ee

s StandardStandard

DeviationDeviation

Binomial Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 56: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5680

Binomial Distribution

3(1)(9) 52 employeesσ = =

EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3EE(( x x ) =) = micro micro = 3(1) = 3 employees out of 3= 3(1) = 3 employees out of 3

Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27Var(Var( x x ) =) = σ σ 22 = 3(1)(9) = 27= 3(1)(9) = 27

s Expected ValueExpected Value

s VarianceVariance

s Standard DeviationStandard Deviation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 57: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5780

Applications

A committee consisting of 5 members votes on

whether or not to hire a new manager The

probability that each memberrsquos vote for

candidate A is 06 Only if over half of the

committee agrees to hire her does candidate Areceive the offer

1) What is the probability that the candidate A

gets an offer

2) What is the probability that the candidate A

does not get the offer

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 58: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5880

Answer

Selected = 03456+ 02592+ 00778

=06826

Not Selected = 1-06826 = 03174

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 59: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 5980

Binomial Tables

Binomial Tables are used to same time

Binomial Tables Binom_Tabpdf

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 60: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6080

Applications

A committee consisting of 5 members votes on

whether or not to hire a new professor The

probability that each memberrsquos vote for candidate

A is 06 Only if over half of the committee agrees

to hire her does candidate A receive the offer 1) What is the probability that the candidate A

gets an offer (Hint 06=04)

2) What is the probability that the candidate A

does not get the offer

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 61: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6180

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

A Poisson distributed random variable is oftenA Poisson distributed random variable is often

useful in estimating the number of occurrencesuseful in estimating the number of occurrences

over aover a specified interval of time or spacespecified interval of time or space

It is a discrete random variable that may assumeIt is a discrete random variable that may assumeanan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )It is a discrete random variable that may assumeIt is a discrete random variable that may assume

anan infinite sequence of valuesinfinite sequence of values (x = 0 1 2 )(x = 0 1 2 )

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 62: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6280

Examples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variableExamples of a Poisson distributed random variable

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of knotholes in 14 linear feet of the number of knotholes in 14 linear feet of

pine boardpine board

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

the number of vehicles arriving at a tollthe number of vehicles arriving at a tollbooth in one hourbooth in one hour

Poisson DistributionPoisson Distribution

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 63: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6380

Poisson DistributionPoisson Distribution

s Two Properties of a Poisson Experiment Two Properties of a Poisson Experiment

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence or

nonoccurrence in any other intervalnonoccurrence in any other interval

22 The occurrence or nonoccurrence in any The occurrence or nonoccurrence in any

interval is independent of the occurrence orinterval is independent of the occurrence ornonoccurrence in any other intervalnonoccurrence in any other interval

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

11 The probability of an occurrence is the same The probability of an occurrence is the same

for any two intervals of equal lengthfor any two intervals of equal length

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 64: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6480

Poisson Probability Function

Poisson Distribution

f xe

x

x

( )

=

minus micro micro

wherewhere

f(x)f(x) = probability of = probability of x x occurrences in an intervaloccurrences in an interval

micro micro = mean number of occurrences in an interval= mean number of occurrences in an interval

ee = 271828= 271828

Poisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 65: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6580

Poisson Distribution

s Example Mercy HospitalExample Mercy Hospital

Patients arrive at the emergency room of Patients arrive at the emergency room of MercyMercy

Hospital at the average rate of 6 per hour onHospital at the average rate of 6 per hour on

weekendweekend

eveningsevenings

What is the probability of 4 arrivals in 30What is the probability of 4 arrivals in 30

minutes on a weekend eveningminutes on a weekend evening

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 66: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6680

Poisson DistributionPoisson Distribution

s Using the Poisson Probability FunctionUsing the Poisson Probability Function

4 33 (271828)(4) 1680

4f

minus

= =

micro micro = 6hour = 3half-hour= 6hour = 3half-hour x x = 4= 4

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 67: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6780

s Poisson Distribution of ArrivalsPoisson Distribution of Arrivals

Poisson DistributionPoisson Distribution

Poisson Probabilities

000

005

010

015

020

025

0 1 2 3 4 5 6 7 8 9 10

Number of Arrivals in 30 Minutes

P r o

b a

b i l i t

y

actuallyactuallythethesequencesequencecontinuescontinues

11 12 hellip11 12 hellip

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 68: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6880

Poisson DistributionPoisson Distribution

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

A property of the Poisson distribution is thatA property of the Poisson distribution is thatthe mean and variance are equalthe mean and variance are equal

micro micro == σ σ 22

Poisson DistributionPoisson Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 69: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 6980

Poisson DistributionPoisson Distribution

s Variance for Number of ArrivalsVariance for Number of Arrivals

During 30-Minute PeriodsDuring 30-Minute Periods

micro micro == σ σ 22 = 3= 3 micro micro == σ σ 22 = 3= 3

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 70: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7080

Example

Arrivals at a bus-stop follow a

Poisson distribution with an average

of 45 every quarter of an hour

Obtain a barplot of the distribution

(assume a maximum of 20 arrivals in

a quarter of an hour) and calculate

the probability of fewer than 3 arrivals

in a quarter of an hour

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 71: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7180

The probabilities of 0 up to 2 arrivals

can be calculated directly from theformula

( )

xe

p x x

λ λ minus

=

45 0

45(0)0

e pminus

=

with λ =45

So p(0) = 001111

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 72: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7280

Similarly p(1)=004999 and p(2)=011248

So the probability of fewer than 3 arrivals

is 001111+ 004999 + 011248 =017358

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 73: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7380

of Binomial Probabilitiesof Binomial Probabilities

When the number of trialsWhen the number of trials nn becomes large becomes large

evaluating the binomial probability function byevaluating the binomial probability function byhand or with a calculator is difficulthand or with a calculator is difficult

The normal probability distribution provides an The normal probability distribution provides an

easy-to-use approximation of binomialeasy-to-use approximation of binomial

probabilitiesprobabilitieswherewhere nn gt 20gt 20 npnp gtgt 5 and5 and nn(1 -(1 - p p)) gtgt 55

Normal ApproximationNormal Approximation

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 74: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7480

of Binomial Probabilitiesof Binomial Probabilities

s SetSet micro micro == npnp

σ = minus(1 )np p

s Add and subtract 05 (aAdd and subtract 05 (a continuity correction factorcontinuity correction factor))

because a continuous distribution is being used tobecause a continuous distribution is being used to

approximate a discrete distribution For exampleapproximate a discrete distribution For example

PP(( x x = 10) is approximated by= 10) is approximated by PP(95(95 ltlt x x ltlt 105)105)

Exponential Probability DistributionExponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 75: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7580

p yp y

s The exponential probability distribution is The exponential probability distribution is

useful in describing the time it takes touseful in describing the time it takes tocomplete a taskcomplete a task

s The exponential random variables can be used The exponential random variables can be used

to describeto describebull Time between vehicle arrivals at a toll booth Time between vehicle arrivals at a toll booth

bull Time required to complete a questionnaire Time required to complete a questionnaire

bull Distance between major defects in a highwayDistance between major defects in a highway

Exponential Probability Distribution

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 76: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7680

Density Function

p y

wherewhere micro micro = mean= mean ee = 271828= 271828

f x e x( ) =

minus1

micro micro

forfor x x gtgt 00 micro micro gt 0gt 0

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 77: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7780

Cumulative Probabilities

Exponential Probability Distribution

P x x ex

( )le = minus minus

0 1 o micro

wherewhere

x x 00 = some specific value of = some specific value of x x

Exponential ProbabilityDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 78: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7880

Distributions Example Alrsquos Full-Service PumpExample Alrsquos Full-Service Pump

The time between arrivals of cars at Alrsquos The time between arrivals of cars at Alrsquosfull-servicefull-service

gas pump follows an exponential probabilitygas pump follows an exponential probability

distribution with a mean time between arrivalsdistribution with a mean time between arrivals

of of

3 minutes Al would like to know the probability3 minutes Al would like to know the probability

thatthat

the time between two successive arrivals will bethe time between two successive arrivals will be

22

minutes or lessminutes or less

xponent a ro a tyDi t ib ti

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 79: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 7980

x x

f ( x )f ( x )

11

33

44

22

1 2 3 4 5 6 7 8 9 101 2 3 4 5 6 7 8 9 10 Time Between Successive Arrivals (mins) Time Between Successive Arrivals (mins)

Distribution

PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486PP(( x x ltlt 2) = 1 - 2718282) = 1 - 271828-23-23 = 1 - 5134 = 486= 1 - 5134 = 486

Relationship between the Poissond E i l Di ib i

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

Page 80: Normal +Bionomial

882019 Normal +Bionomial

httpslidepdfcomreaderfullnormal-bionomial 8080

and Exponential Distributions

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The Poisson distribution The Poisson distributionprovides an appropriate descriptionprovides an appropriate description

of the number of occurrencesof the number of occurrences

per intervalper interval

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences

The exponential distribution The exponential distribution

provides an appropriate descriptionprovides an appropriate description

of the length of the intervalof the length of the interval

between occurrencesbetween occurrences