Normal +Bionomial
Transcript of Normal +Bionomial
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Probability Distribution
Random variables
Discrete
Continuous
Applications
Binomial Tables Applications
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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
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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
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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
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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
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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
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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
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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
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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
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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 ))
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Answer
Selected = 03456+ 02592+ 00778
=06826
Not Selected = 1-06826 = 03174
882019 Normal +Bionomial
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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
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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
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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
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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
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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
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
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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
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
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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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( )( ) (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
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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
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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
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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
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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
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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
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Answer
Selected = 03456+ 02592+ 00778
=06826
Not Selected = 1-06826 = 03174
882019 Normal +Bionomial
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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
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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
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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
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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
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
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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
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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
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
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
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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
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
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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
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
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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
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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
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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
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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
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
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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
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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
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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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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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
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
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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
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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
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Answer
Selected = 03456+ 02592+ 00778
=06826
Not Selected = 1-06826 = 03174
882019 Normal +Bionomial
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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
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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
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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
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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
882019 Normal +Bionomial
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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
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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
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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
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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
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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
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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
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
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
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Binomial Tables
Binomial Tables are used to same time
Binomial Tables Binom_Tabpdf
882019 Normal +Bionomial
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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
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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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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