T i 2

Topic

Probabilityy Distribution

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution
Definitions:

A random variable is a variable whose value is

determined by the outcome of a random experiment.

A random variable that assumes countable values is called

a discrete random variable.

A random variable that can assume any value contained in

one or more intervals is called a continuous random
variable.

1
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
Examples (of discrete random variables):

 The number of cars sold at a dealership during a given

month.

 The number of people coming to a theater on a certain

day.

 The number of complaints received at the office of an

airline on a given day.

 The number of customers visiting a bank during any

given hour.

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution

Examples (of continuous random variables):

 The height of a person.

 The time taken to complete an examination.

 The amount of milk in a gallon (note that we do not

expect a gallon to contain exactly one gallon of milk but
either slightly more or slightly less than a gallon).

2
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
Example:

Suppose the following gives the frequency and relative

frequency distributions of the vehicles owned by all 2000
families living in a small town.

Number of Vehicles Owned Frequency

0 30
1 470
2 850
3 490
4 160
Frequency distribution of the owned vehicles

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution
Suppose one family is randomly selected from this
population. The act of randomly selecting a family is
called a random or chance experiment.
experiment

Let X denote the number of vehicles owned by the selected

family. Then X can assume any of the five possible values
(0, 1, 2, 3, and 4) listed in the first column of the Table.

The value assumed by X depends on which family is

selected. Thus, this value depends on the outcome of a
random experiment.

3
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution

Definitions:

The probability function or probability

distribution P ( X ) of a discrete random variable can be
represented by a formula, a table or a graph, which provides
the probabilities P ( x) or P ( X  x) or f ( x) corresponding to
each and every value of x.

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution

Three Characteristics of a Probability Distribution

The probability distribution of a discrete random variable

possesses the following three characteristics:

0  P ( X )  1 for each value of x

 P( X )  1
P( x)  P( X  x)

4
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
Example (revisit):

Suppose
pp the followingg ggives the frequency
q y and relative
frequency distributions of the vehicles owned by all 2000
families living in a small town.

Number of Vehicles Owned Frequency

0 30
1 470
2 850
3 490
4 160
Frequency distribution of the owned vehicles

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution
Let X be the number of vehicles owned by a randomly
selected family.
To construct the probability distribution of X
X, we first
compute the relative frequencies:

Number of Frequency Relative

Vehicles Owned Frequency
0 30 0.015
1 470 0.235
2 850 0.425
3 490 0.245
4 160 0.080
Relative frequency distribution

5
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
When the relative frequencies are known for the population,
they give the actual (theoretical) probabilities of outcomes.
Using the relative frequencies,
frequencies we can write the probability
distribution of the discrete random variable X:
Number of Probability
Vehicles Owned (x) P( x)  P( X  x)

0 00.015
015
1 0.235
2 0.425
3 0.245
4 0.080
Probability distribution

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution
From the probability distribution, the probability for any
value X can be read.
For example, the probability that a randomly selected
family from this town owns two vehicles is 0.425. The
probability is written as
P ( X  2)  0.425
The probability
Th b bilit that
th t the
th selected
l t d family
f il owns more than th
two vehicles is given by the sum of the probabilities of
three and four vehicles, respectively. This probability is
written as
P ( X  2)  P ( X  3)  P ( X  4)  0.325

6
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
Definitions:
Let X be a discrete random variable with probability
di ib i
distribution P( X ) .
The mean or expected value is
  E ( X )   x  P( x)

Let X be a discrete random variable with probability

distribution P ( X ) and mean  .
The variance of X is
 2  Var ( X )   ( x   ) 2  P ( x)
OR  2  Var ( X )    x 2  P( x)    2

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution
Example:

g table lists the p

The following probabilityy distribution of the
number of breakdowns per week for a machine based on
past data.

Breakdowns per week 0 1 2 3

Probability 0 15
0.15 0 20
0.20 0 35
0.35 0 30
0.30

Find the probability that the number of breakdowns for this

machine during a given week is ( a ) exactly two ( b ) zero
to two ( c ) more than one ( d ) at most one.

7
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
Solution:
Let X denote the number of breakdowns for this machine
during a given week.
( a ) the probability of exactly two breakdowns

P ( X  2)  0.35

( b ) the probability of zero to two breakdowns

P (0  X  2)  P ( X  0)  P ( X  1)  P( X  2)

 0.15  0.20  0.35  0.70

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution

( c ) the probability of more than one breakdown

P ( X  1)  P ( X  2)  P ( X  3)
 0.35  0.30  0.65

( d ) the probability of at most one breakdown

P ( X  1)  P( X  0)  P ( X  1)

 0.15  0.20  0.35

8
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
Further question:
Find the mean number of breakdowns per week for this
machine
machine.
Recall:   E ( X )   x  P ( x)

x P( x) x  P ( x)
0 0.15 0.00
1 0 20
0.20 0 20
0.20
2 0.35 0.70
3 0.30 0.90
 x  P( x)  1.80
The mean is   1.80

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution

On average, this machine is expected to break down 1.80

times per week over a period of time.

In other words, if this machine is used for many weeks,

then for certain weeks we will observe no breakdowns; for
some other weeks we will observe 1 breakdown per week;
and for still other weeks we will observe 2 or 3
breakdowns per week.
week

The mean number of breakdowns is expected to be 1.80

per week for the entire period.

9
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution

Example:

The following table gives the probability distribution of a

random variable X.

x 0 1 2 3
P( X ) 0.2 0.1 0.3 0.4

Find the variance of the random variable X.

Section 1 – Discrete Random Variable

Section 1.1 Probability Distribution
Solution:
By definition  2  Var ( X )   ( x   ) 2  P ( x)

x P( x) x  P ( x) ( x   ) 2  P( x)
0 0.2 0.0 0.722
1 0.1 0.1 0.081
2 03
0.3 06
0.6 0 003
0.003
3 0.4 1.2 0.484
 x  P( x)  1.9  ( x   )2  P( x)  1.29
The variance is  2  1.29

10
Section 1 – Discrete Random Variable
Section 1.1 Probability Distribution
By alternative formula
 2  Var ( X )    x 2  P( x)    2

x P( x) x  P ( x) x 2  P( x)
0 0.2 0.0 0.0
1 0.1 0.1 0.1
2 03
0.3 06
0.6 12
1.2
3 0.4 1.2 3.6
 x  P( x)  1.9  x2  P( x)  4.9
The variance is  2  4.9  1.92  1.29

Section 1 – Discrete Random Variable

Section 1.2 Binomial Probability Distribution

The Binomial Probability Distribution is one of

the most widely
y used discrete p
probability
y distributions.

To apply the binomial probability distribution, the random

variable X must be a discrete random variable and each
repetition of the experiment must result in one of two
possible outcomes.

An experiment that satisfies the four conditions (on next

slide) is called a binomial experiment. Each repetition of a
binomial experiment is called a trial or a
Bernoulli trial (after Jacob Bernoulli).

11
Section 1 – Discrete Random Variable
Section 1.2 Binomial Probability Distribution
 There are n identical trials. In other words, the given
experiment is repeated n times. All these repetitions are
performed under identical conditions.
conditions

 Each trial has two and only two outcomes. These

outcomes are usually called a success and a failure.

 The probability y of success is denoted byy p and that of

failure by (1  p ) . The probabilities p and (1  p ) remain
constant for each trial.

 The trials are independent. In other words, the outcome

of one trial does not affect the outcome of another trial.

Section 1 – Discrete Random Variable

Section 1.2 Binomial Probability Distribution

Example:

Five percent of all DVD players manufactured by a large

electronics company are defective. Three DVD players
are randomly selected from the production line of this
company. The selected DVD players are inspected to
determine if each of them is defective or good.

Is this experiment a binomial experiment?

12
Section 1 – Discrete Random Variable
Section 1.2 Binomial Probability Distribution
Solution:

 This example consists of three identical trials. A trial

represents the selection of a DVD player.

 Each trial has two outcomes: A DVD player is defective

or a DVD player is good. Let a defective VCR be called
a success and a good DVD player be called a failure.

 Five percent of all DVD players are defective. So, the

probability p that a DVD player is defective is 0.05.
As a result, the probability (1  p ) that a DVD player is
good is 0.95. These two probabilities add up to 1.

Section 1 – Discrete Random Variable

Section 1.2 Binomial Probability Distribution

 Each trial (DVD player) is independent.

In other words,, if one DVD p player
y is defective it does
not affect the outcome of another DVD player being
defective or good.
This is so because the size of the population is very large
as compared to the sample size.

Since all four conditions of a binomial experiment are

satisfied, this is an example of a binomial experiment.

13
Section 1 – Discrete Random Variable
Section 1.2 Binomial Probability Distribution

Definition: The random variable X that represents the

number of successes in n trials for a binomial experiment
p
is called a binomial random variable.

The probability distribution of X in such experiments is

called the binomial probability distribution or
simply binomial distribution.

Section 1 – Discrete Random Variable

Section 1.2 Binomial Probability Distribution

Binomial Formula
For a binomial experiment, the probability of exactly x
successes in n trials is given by the binomial formula

n
P ( x)  P( X  x)    p x (1  p ) n x x  0,1,, n
 x

where n = total number of trials

p = probability of success
x = number of successes in n trials

14
Section 1 – Discrete Random Variable
Section 1.2 Binomial Probability Distribution

X ~ Bin(n, p ) denotes that X follows a binomial

distribution with parameters n and p.
p

The mean and variance of the binomial distribution are

  E ( X )  np and  2  Var ( X )  np(1  p)

Section 1 – Discrete Random Variable

Section 1.2 Binomial Probability Distribution

Example:

The answer to a true/false question is either correct or

incorrect. Assume that ( i ) an examination consists of four
true/false questions and ( ii ) a student has no knowledge of
the subject matter.

The chance
Th h ( b bilit ) that
(probability) th t the
th student
t d t will
ill guess the
th
correct answer to the first question is 0.50. Likewise, the
probability of guessing each of the remaining questions
correctly is 0.50.

15
Section 1 – Discrete Random Variable
Section 1.2 Binomial Probability Distribution

What is the probability of:

( a ) Getting exactly none of four correct?

( b ) Getting exactly one of four correct?
( c ) Getting exactly two of four correct?

Section 1 – Discrete Random Variable

Section 1.2 Binomial Probability Distribution
Solution:

Note that the binomial conditions are met:

 There is a fixed number of trials (i.e. n  4 )

 There are only two possible outcomes

(i.e. correct/incorrect)

 There is a constant probability of success (i.e. p  0.5 )

 The trials are independent

16
Section 1 – Discrete Random Variable
Section 1.2 Binomial Probability Distribution

( a ) The probability of getting exactly none of four

correct

 4
P ( X  0)    (0.5)0 (1  0.5) 40  0.0625
0

Section 1 – Discrete Random Variable

Section 1.2 Binomial Probability Distribution

( b ) The probability of getting exactly one of four

correct

 4
P ( X  1)    (0.5)1 (1  0.5) 41  0.25
1

17
Section 1 – Discrete Random Variable
Section 1.2 Binomial Probability Distribution

( c ) The probability of getting exactly two of four

correct

 4
P ( X  2)    (0.5) 2 (1  0.5) 42  0.375
 2

Section 1 – Discrete Random Variable

Section 1.3 Poisson Probability Distribution

The Poisson probability distribution is applied

to experiments with random and independent occurrences.
occurrences

The occurrences are random in the sense that they do not

follow any pattern and, hence, they are unpredictable.

Independence
p of occurrences means that one occurrence
(or nonoccurrence) of an event does not influence the
successive occurrences or nonoccurrence of that event.

18
Section 1 – Discrete Random Variable
Section 1.3 Poisson Probability Distribution

The occurrences are always considered with respect to an

interval. The interval mayy be a time interval, a space
p
interval, or a volume interval.

The actual number of occurrences within an interval is

random and independent. If the average number of
occurrences for a given interval is known, then by using
th Poisson
the P i probability
b bilit distribution
di t ib ti we can computet the
th
probability of a certain number of occurrences X in that
interval.

Section 1 – Discrete Random Variable

Section 1.3 Poisson Probability Distribution
Conditions to apply Poisson probability distribution
The following three conditions must be satisfied:

The experiment consists of counting the number, X, of times a

particular event occurs during a given unit of time, or a given
area or volume (or weight, or distance, or any other unit of
measurement)

The probability that an event occurs in a given unit of time,

area, or volume is the same for all the units.

The number of events that occur in one unit of time, area, or

volume is independent of the number that occur in other units.

19
Section 1 – Discrete Random Variable
Section 1.3 Poisson Probability Distribution

In the Poisson probability distribution terminology,

the average
g number or occurrences in an interval is denoted
by  .

The actual number of occurrences in that interval is denoted

by X. Then, using the Poisson probability distribution, we
find the probability of X occurrences during an interval
given
i th mean occurrences are  during
the d i thatth t interval.
i t l

Section 1 – Discrete Random Variable

Section 1.3 Poisson Probability Distribution
Poisson Probability Distribution Formula
According to the Poisson probability distribution, the
probability of x occurrences in an interval is

 x e  x  0,1,2,
P ( x)  P ( X  x) 
x!

h  is
where i the
h mean number
b off occurrences in
i that
h interval.
i l

The mean and variance of the Poisson distribution are

  E( X )   and  2  Var ( X )  

20
Section 1 – Discrete Random Variable
Section 1.3 Poisson Probability Distribution

Example:

A washing
hi machine
hi in
i a laundry
l d breaks
b k down
d an average off
three times per month.

Using the Poisson probability distribution formula, find the

probability that during the next month this machine will
have
( a ) exactly two breakdowns;
( b ) at most one breakdown.

Section 1 – Discrete Random Variable

Section 1.3 Poisson Probability Distribution

Solution:

Let  be the mean number of breakdowns per month and X

be the actual number of breakdowns observed during the
next month for this machine. Then,   3 .

3x e 3
 P ( X  x) 
x!

21
Section 1 – Discrete Random Variable
Section 1.3 Poisson Probability Distribution
( a ) The probability that exactly two breakdowns will be
observed during the next month

32 e 3
P ( X  2)   0.224
2!

( b ) The probability that at most one breakdown will be

observed during the next month

30 e 3 31 e 3
P ( X  1)    0.1992
0! 1!

Section 1 – Discrete Random Variable

Section 1.3 Poisson Probability Distribution

Poisson Approximation to the Binomial

Distribution

The computation of probabilities for a binomial

distribution could be tedious if the number of trials n is
large.

In the situation,
situation the Poisson distribution can be used to
approximate the binomial probabilities when the number
of trials n is large and at the same time the probability p is
small (generally such that   np  7 ).

22
Section 1 – Discrete Random Variable
Section 1.3 Poisson Probability Distribution

Proposition

Let X be
L b the
h number b off success resulting
li f
from n
independent trials, each with probability of success p. The
distribution of the number of success X is binomial, with
mean np .

If the number of trials n is large and np is of only moderate

size (i.e. np  7 ), this distribution can be approximated by
the Poisson distribution with   np .

Section 1 – Discrete Random Variable

Section 1.3 Poisson Probability Distribution

The pprobability
y of the approximating
pp g distribution is then:

(np ) x e  np x  0,1,2,
P( x)  P( X  x) 
x!

23
Section 1 – Discrete Random Variable
Section 1.3 Poisson Probability Distribution

Example:

An analyst predicted that 3.5% of small corporations would

file for bankruptcy in the coming year.

For a random sample of 100 small corporations, estimate

the probability that at least three will file for bankruptcy in
the
h next year, assuming i that
h theh analyst’s
l ’ prediction
di i i
is
correct.

Section 1 – Discrete Random Variable

Section 1.3 Poisson Probability Distribution
Solution:
The distribution of X, the number of small corporations that
will
ill file
fil for
f bankruptcy,
b k t is i binomial
bi ith n  100 andd
i l with
p  0.035 , so that the mean of the distribution is np  3.5 .

Using the Poisson distribution to approximate the

probability of at least three bankruptcies:
P ( X  3)  1  P( X  2)

 1  P ( X  0)  P( X  1)  P( X  2)
(3.5)0 e 3.5 (3.5)1 e 3.5 (3.5) 2 e 3.5
 1    0.679
0! 1! 2!

24
Section 1 – Discrete Random Variable
Section 1.4 Hypergeometric Probability Distribution

One of the applications of the binomial probability

di ib i is
distribution i its
i use as the
h probability
b bili distribution
di ib i for f the
h
number X of favorable (or unfavorable) responses in a
public opinion or market survey.

Ideally, it is applicable when sampling is with

replacement that is,
replacement, is each item drawn from the population
is observed and returned to the population before the next
item is drawn.

Section 1 – Discrete Random Variable

Section 1.4 Hypergeometric Probability Distribution
Practically speaking, the sampling in surveys is rarely
conducted with replacement. Nevertheless, the binomial
probability
b bilit distribution
di t ib ti is
i still
till appropriate
i t if the
th number
b N
of elements in the population is large and the sample size n
is small relative to N.

When sampling is without replacement, and the number of

elements N in the population is small (or when the sample
size n is large relative to N), the number of "successes" in
a random sample of n items has a hypergeometric
probability distribution.

25
Section 1 – Discrete Random Variable
Section 1.4 Hypergeometric Probability Distribution

Characteristics that define a Hypergeometric Random

Variable:

The experiment consists of randomly drawing n elements

without replacement from a set of N elements, r of which are
“successes” and N  r of which are “failures”.

The hypergeometric
Th h t i random
d variable
i bl X is
i the
th number
b off
“successes” in the draw of n elements.

Section 1 – Discrete Random Variable

Section 1.4 Hypergeometric Probability Distribution

Hypergeometric Probability Distribution

Formula
For a Hypergeometric Probability Distribution, the
probability of exactly x "successes" in n trials is given by
the Hypergeometric Probability distribution formula

 r  N  r 
 x  n  x 
P ( x)  P ( X  x)    
N
n
 

26
Section 1 – Discrete Random Variable
Section 1.4 Hypergeometric Probability Distribution

where N = number of elements in the population

r = number of successes in the population
n = sample
l size
i
x = number of successes in the sample

Assumptions:
•The sample of n elements is randomly selected from the
N elements of the population.

•The value of X is restricted so that all factorials are

nonnegative.

Section 1 – Discrete Random Variable

Section 1.4 Hypergeometric Probability Distribution

The mean and variance of the Hypergeometric distribution

are
nr
  E( X ) 
N
and

r  N  r  N  n 
 2  Var ( X )  n    
 N  N  N  1 

 N n
The expression   is known as the finite
 N 1 
population correction factor.

27
Section 1 – Discrete Random Variable
Section 1.4 Hypergeometric Probability Distribution
Example:

Of six lecturers, four have been with the college five or

more years. If three lecturers are chosen randomly from the
group of six, find the probability that exactly two will have
five or more years seniority.

Section 1 – Discrete Random Variable

Section 1.4 Hypergeometric Probability Distribution

Solution:

For this problem,

problem the number of elements in the population
is N  6, the number of "successes" is r  4 and the sample
size is n  3 .

The required probability is

 4  6  4 
 2  3  2 
P ( X  2)      0.6
 
6
 3
 

28
Section 1 – Discrete Random Variable
Section 1.5 Negative Binomial Distribution

Suppose that independent trials,

trials each having probability p,
p
where 0  p  1 , of being a success are performed until a
total of r successes is accumulated.

If we let X be the number of trials required, then X follows

the Negative
g Binomial Distribution.

Section 1 – Discrete Random Variable

Section 1.5 Negative Binomial Distribution

According to the Negative Binomial distribution, the

pprobabilityy of pperformingg k independent
p trials until a total
of r successes is accumulated is:

 k  1 r
P( X  k )    p (1  p ) k r k  r , r  1,
 r 1

where p is the probability of each trial being a success.

29
Section 1 – Discrete Random Variable
Section 1.5 Negative Binomial Distribution

X ~ NegBin( r , p ) denotes that X follows a negative

binomial distribution with parameters r and p.
p

The mean and variance of the Negative Binomial

distribution with parameters r, p are

r r (1  p )
  E( X )  and  2  Var ( X ) 
p p2

Section 1 – Discrete Random Variable

Section 1.5 Negative Binomial Distribution
Example:
If independent
p trials, each resultingg in a success with
probability p, are performed, what is the probability of r
successes occurring before m failures?

Solution:
Note that r successes will occur before m failures if and
only if the rth success occurs no later than the ( r  m  1) th
trial.
r  m 1
 k  1 r
Hence, the desired probability is 
k r
 r  1  p (1  p )
 
k r

30
Section 1 – Discrete Random Variable
Section 1.5 Negative Binomial Distribution
Example:

A company takes out an insurance policy to cover accidents

that occur at its manufacturing plant. The probability that
one or more accidents will occur during any given month is
0.6. The number of accidents that occur in any given
month is independent of the number of accidents that occur
in all other months.

Calculate the probability that there will be at least four

months in which no accidents occur before the fourth
month in which at least one accident occurs.

Section 1 – Discrete Random Variable

Section 1.5 Negative Binomial Distribution

Solution:

If a month with one or more accidents is regarded as

success and X be the number of failures before the fourth
success, then X follows a negative binomial distribution of
the requested probability is

P ( X  4)  1  P ( X  3)

3
3 k 
 1   (0.6) 4 (1  0.6) k  0.2898
k 0  k 

31
Section 2 – Continuous Random Variable
Section 2.1 Probability Distribution

Definitions:

A continuous random variable is defined as a

random variable whose values are not countable. A
continuous random variable can assume any value over an
interval or intervals.

Because the number of values contained in any interval is

infinite, the possible number of values that a continuous
random variable can assume is also infinite.

Section 2 – Continuous Random Variable

Section 2.1 Probability Distribution
Since there are infinitely many possible values for a
continuous variable, we cannot possible list those values
in a table,
table as we did with probability distributions for
discrete random variables.

The distribution of a continuous X must be given not by a

list or table of probabilities but by a continuous curve. The
curve is called frequency curve, or a probability
density curve.

The area under the curve between two limits on the

horizontal scale is the probability that the random variable
will take on a value lying between those two limits.

32
Section 2 – Continuous Random Variable
Section 2.1 Probability Distribution

Definition:

If X is
i a continuous
ti random
d i bl andd y  f ( x) is
variable i a
function such that f ( x)  0 for all X, then y  f ( x) is
called the probability density function (pdf) of
the continuous random variable X if for any numbers a and
b, the area under the graph of y  f ( x) from X  a to
X  b equals the probability that X lies between a and b.b

Note: The probability that a continuous random variable

assumes a single value is zero. That is,
P( X  c)  0 P ( X  c)  P ( X  c)

Discrete Random Variable

Section 2 – Continuous Random Variable

Section 2.1 Probability Distribution
Example:
An investment firm offers its customers municipal bonds
that mature after varying numbers of years. Given that the
cumulative distribution of T, the number of years to
maturity for a randomly selected bond is

 0 t 1
0.25 1  t  3

F (t )   0.5 3  t  5
0.75 5  t  7

 1 t7

33
 Discrete Random Variable

Section 2 – Continuous Random Variable

Section 2.1 Probability Distribution

Calculate:
( a ) P (T  5) ( b ) P (T  3) ( c ) P (1.4  T  6)

Solution:

( a ) P (T  5)  0 .25

( b ) P (T  3)  1  P(T  3)  1  0.5  0.5

( c ) P (1.4  T  6)  P(T  6)  P(T  1.4)  0.75  0.25  0.5

Section 2 – Continuous Random Variable

Section 2.1 Probability Distribution
Example:

Assume the value of the continuous random variable X is

between x  1 and 3.

It has a density function given by f ( x)  0.5

Calculate the following probabilities:

( a ) P (2  X  2.5)

( b ) P ( X  16)

34
Section 2 – Continuous Random Variable
Section 2.1 Probability Distribution

Solution:
f ( x)
( a ) P (2  X  2.5)  0.25

( b ) P ( X  16)  1 0.5

0 1 3 x

Section 2 – Continuous Random Variable

Section 2.2 Normal Distribution

The normal distribution is the most important and

most widelyy used of all the p
probabilityy distributions. A large
g
number of phenomena in the real world are normally
distributed either exactly or approximately.

A random variable is said to have a normal

probability distribution if and only if the probability
density function of X is

1
f ( x)  e  ( x  ) /2
2 2

2 

35
Section 2 – Continuous Random Variable
Section 2.2 Normal Distribution
The random variable X that has a normal distribution is
called a normal random variable.
Examples
E l off continuous
i random
d variables
i bl that
h have
h all
ll been
b
observed to have a (approximate) normal distribution:

•the heights and weights of people

•scores on an examination

•weights of packages (e.g., cereal boxes, boxes of cookies)

•amount of milk in a gallon

•life of an item (such as a light bulb or a television set)

•the time taken to complete a certain job

Section 2 – Continuous Random Variable

Section 2.2 Normal Distribution

Characteristics of Normal Probability

Distribution
A normal probability distribution, when plotted, gives a
bell-shaped curve such that

 The total area under the curve is 1.0.

 The curve is symmetric about the mean.

 The two tails of the curve extend indefinitely.

36
Section 2 – Continuous Random Variable
Section 2.2 Normal Distribution

If X is a normal distributed random variable with parameters

 and  , then

E( X )   and Var ( X )   2

X ~ N (  , 2 ) denotes that X follows a normal

distribution with mean  and  .

The mean  and the standard deviation  are the

parameters of the normal distribution. Each different set of
values of  and  gives a different normal distribution.

Section 2 – Continuous Random Variable

Section 2.2 Normal Distribution

The value of  determines the center of a normal

distribution on the horizontal axis and the value of  gives
the spread of the normal distribution curve.

N (0,0.25)

N (0,1)
(0 1)
N (1,1)
N (1,1)

N (0, 4)

37
Section 2 – Continuous Random Variable
Section 2.2 Normal Distribution

The probability that a normal random variable X takes on a

value in a specified interval ( x1 , x2 ) is found by determining
the area enclosed by the x-axis, the lines X  x1 , X  x2 and
the bell shape curve.

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

Definition: The normal distribution with   0 and   1

is called the standard normal distribution.

Notation: Z ~ N (0, 1)

The
h probability
b bili or area under
d theh standard
d d normall curve
can be found from the standardized normal table.

38
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

Examples:

P ( Z  1.95)
 0.0256
0 0256

P ( Z  1.32)
 0.9066

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

Standardizing a Normal Distribution

Standard normal distribution table can be used to find areas

under the standard normal curve. However, in real-world
applications, a (continuous) random variable may have a
normal distribution with values of the mean and standard
deviation different from 0 and 1, respectively.

The first step is to convert the given normal distribution to

the standard normal distribution. This procedure is called
standardizing a normal distribution.

39
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

Converting an X value to a Z value

For a normal random variable X, a particular value of X can

be converted to a Z value by using the formula

X 
Z


where  and  are the mean and standard deviation of

the normal distribution of X.

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

Example:
Lett X be
L b a continuous
ti random
d variable
i bl that
th t is
i normally
ll
distributed with a mean of 25 and a standard deviation of 4.

Find the area

( a ) between X  25 and X  32

(b) between X  18 and X  34

40
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution
Solution:
For the given information,   25  4

( a ) The area between X  25 and X  32

25  25
X  25  Z  0
4
32  25
X  32  Z   1.75
4
The area between X  25 and X  32 under the given
normal distribution curve is equivalent to the area
between Z  0 and Z  1.75 under the standard normal
curve.

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

The required area can be written as probability

P (25  X  32)  P (0  Z  1.75)  0.4599

( b ) The area between X  18 and X  34

 18  25 34  25 
P (18  X  34)  P  Z 
 4 4 

 P  1.75  Z  2.25   0.9477

41
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution
Determining the Z values when an area under the
Normal Distribution Curve is Known

Example:
Find the value of Z such that the area under the standard
normal curve in the right tail is 0.05.

S l ti
Solution:

P ( Z  z )  0.05 

 z  1.645

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution
Example:
Find the value of Z such that the area under the standard
normal curve in the left tail is 0.005.
0 005

Solution:
P ( Z  z )  0.005  z  2.575

 

42
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution
Example:
Find a point Z such that the area under the standard normal
curve between 0 and Z is 0.4251 and the value of Z is
positive.
Solution: P (0  Z  z )  0.4251  P ( Z  z )  0.0749
 z  1.44

 

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution
Finding an X value for a Normal Distribution

To find an X value when an area under a normal

distribution curve is given, first we find the Z value
corresponding to that X value from the normal distribution
table.

Th the
Then, th X value
l isi calculated
l l t d using
i the
th formula
f l
X 
Z  X    Z


43
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

Example:

It is known that the life of a calculator manufactured by

Intal Corporation has a normal distribution with a mean of
54 months and a standard deviation of 7.65 months.

What should the warranty period be to replace a

malfunctioning calculator if the company does not want to
replace more than 1% of all the calculators sold?

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution
Solution:
Let X be the life of a calculator  X ~ N  54, 7.652 
The calculators that would be replaced are the ones that
start malfunctioning during the warranty period. The
company’s objective is to replace at most 1% of all the
calculators sold. We are to find the value of X so that the
area to the left of X under the normal curve is 1% or 0.01.
P ( Z  z )  0.01
0 01  z  22.33
33
 X  54  (7.65)(2.33)  36.1755
Thus, the warranty period should be 36.1755 months
(which can be rounded down to 36 months) if the company
is to replace no more than 1% of the calculators.

44
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

Normal Distribution as an Approximation to Binomial

Distribution

Usually, the normal distribution is used as an

approximation to the binomial distribution when both
np  5 and n(1  p )  5 .

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

Using the normal distribution as an approximation to

the binomial involves the following
g three steps:
p

Step 1: Compute  and  for the binomial distribution

  np   np(1  p)

45
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

Step 2: Convert the discrete random variable to a

continuous random variable

The normal distribution applies to a continuous random

variable, whereas the binomial distribution applies to a
discrete random variable. The second step in applying the
normal approximation to the binomial distribution is to
convert the discrete random variable to a continuous
random variable by making the correction for continuity.

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution
The addition of 0.5 and/or subtraction of 0.5 from the
value(s) of x when the normal distribution is used as an
approximation to the binomial distribution,
distribution where x is the
number of successes in n trials, approximated by the
interval ( x  0.5, x  0.5) .

x–1 x x+1 x–1 x x+1

x – 0.5 x + 0.5

Step 3: Compute the required probability using the

normal distribution

46
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution
Example:

Assume that
A th t X ~ Bin
Bi (100,
(100 0.36)
0 36) .
Use the normal approximation of binomial distribution to
find the following probability:

(a) P( X  51) (e) P (30  X  40)

(b) P( X  51) (f) P (30  X  40)
(c) P( X  45) (g) P(30  X  40)
(d) P( X  45) (h) P(30  X  40)

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

Solution:

Since np  36  5 and n(1  p )  64  5 , we can use the

normal approximation of binomial distribution. That is,

X ~ N (100  0.36, 100  0.36  0.64)  X ~ N (36, 23.04)

 51.5  36 
( a ) P ( X  51)  P( X  51.5)  P  Z  
 23.04 

 P( Z  3.22)  0.00064

47
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

 50.5  36 
( b ) P ( X  51)  P ( X  50.5)  P  Z  
 23.04 

 P( Z  3.02)  0.00126

 44.5  36 
( c ) P ( X  45)  P ( X  44.5)  P  Z  
 23.04 

 P( Z  1.77)  0.9616

( d ) P ( X  45)  P ( X  45.5)  P( Z  1.98)  0.9761

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

( e ) P (30  X  40)  P(30.5  X  39.5)

 P(1.15  Z  0.73)  0.6422

( f ) P (30  X  40)  P (30.5  X  40.5)

 P(1.15  Z  0.94)  0.7013

( g ) P (30  X  40)  P (29.5  X  39.5)

 P(1.35  Z  0.73)  0.6788

( h ) P (30  X  40)  P(29.5  X  40.5)

 P(1.35  Z  0.94)  0.7379

48
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

Example:

According to an estimate, 50% of the people in America

have at least one credit card. If a random sample of 30
persons is selected, what is the probability that 19 of them
will have at least one credit card?

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution

Solution:

Let X be
L b the
h numberb off persons in
i the
h sample
l who
h have
h at
least one credit card.

 X ~ Bin(30, 0.5)

Required
q probability:
p y

 30 
P ( X  19)    (0.5)19 (1  0.5)11  0.0509
 19 
(Exact Solution)

49
Section 2 – Continuous Random Variable
Section 2.3 Standard Normal Distribution

Now let us solve this problem using the normal distribution

as an approximation
pp to the binomial distribution. For this
example,
np  15  5 n(1  p )  15  5

 We can use the normal distribution as an approximation

to solve the problem.

X ~ N (30  0.5, 30  0.5  0.5)  X ~ N (15, 7.5)

Section 2 – Continuous Random Variable

Section 2.3 Standard Normal Distribution
Required probability:

P ( X  19)  P (18.5
(18 5  X  19
19.5)
5)

 18.5  15 19.5  15 
 P Z 
 7.5 7.5 

 P(1.28
(1 28  Z  11.64)
64)  00.0498
0498
Using the binomial formula, the exact probability is
0.0509. The error due to using the normal approximation
is 0.0011. Thus, the exact probability is underestimated
by 0.0011 if the normal approximation is used.

50
Section 2 – Continuous Random Variable
Section 2.4 Uniform Probability Distribution

A continuous uniform probability distribution is a simple

distribution with a rectangular shape,
shape and it is useful in a
diverse number of applications.

For example:
The time that a commuter waits to board a MTR train from
Central to Causewayy Bay
y has a uniform distribution.

Section 2 – Continuous Random Variable

Section 2.4 Uniform Probability Distribution

Definition: A continuous random variable X is said to have a

continuous uniform probability y distribution
on the interval ( a, b) if and only if the probability density
function of X is

 1/ (b  a ) if a  x  b
f ( x)  
 0 elsewhere

51
Section 2 – Continuous Random Variable
Section 2.4 Uniform Probability Distribution
Remarks:

The values of a and b are parameters or constants,

constants and their
particular values depend on the probability problem.
The smallest value the random variable can take is a and the
largest is b.

There
e e iss a ddifferent
e e uuniform
o ddistribution
s bu o from o thee familyy oof
uniform distributions for each pair of values for a and b.

Section 2 – Continuous Random Variable

Section 2.4 Uniform Probability Distribution

The mean and the variance of a continuous uniform

probability distribution X are

ab (b  a ) 2
  E( X )  and   Var ( X ) 
2

2 12

52
Section 2 – Continuous Random Variable
Section 2.4 Uniform Probability Distribution

The probability that a continuous uniform random variable

X takes on a value in a specified interval ( x1 , x2 ) is found by
determining the corresponding area of a rectangle under the
probability density function.
1
That is, P ( x1  X  x2 )  ( width)  (height )  ( x2  x1 ) 
for a  x1  x2  b . ba

If x1  a or x2  b , then the width of the rectangular area is

reduced accordingly.

Section 2 – Continuous Random Variable

Section 2.4 Uniform Probability Distribution
Example:
An industrial psychologist has determined that it takes a
worker
k between
b 9 andd 15 minutes
i to complete
l a taskk on an
automobile assembly line.
If the continuous random variable–time to complete the
task is uniformly distributed over the interval 9  X  15 ,
then determine for this distribution:
(a) f ( x), E ( X ), Var ( X )
(b) P ( X  13)
(c) P (4  X  7)
(d) P (6  X  18)

53
Section 2 – Continuous Random Variable
Section 2.4 Uniform Probability Distribution
Solution:
( a ) f ( x), E ( X ), Var ( X )

 1 1
  if 9  x  15
f ( x)   15  9 6
 0 elsewhere

a  b 9  15
E( X )    12
2 2

(b  a ) 2 (15  9) 2
Var ( X )   3
12 12

Section 2 – Continuous Random Variable

Section 2.4 Uniform Probability Distribution

13  9 2
( b ) P ( X  13)    0.6667
6 3

( c ) P (4  X  7)  0 because f ( x)  0 everywhere
except in the interval 9  X  15 .

15  9
( d ) P (6  X  18)  P(9  X  15)  1
6

54
Section 2 – Continuous Random Variable
Section 2.5 Exponential Distribution

A continuous probability distribution that is often useful in

describing the time it takes to complete a task is the
exponential probability distribution.

The exponential random variable can be used to describe

such things
suc gs as:
s:
- The time between arrivals at a car wash
- The time required to load a truck
- The distance between major defects in a highway

Section 2 – Continuous Random Variable

Section 2.5 Exponential Distribution
Definition: A continuous random variable X is said to have
an exponential distribution if and only if the
probability density function of X is:

f ( x)   e  x for x  0,   0

1
Denote   .

The mean and the variance of the exponential distribution
are
E( X )   and Var ( X )   2

55
Section 2 – Continuous Random Variable
Section 2.5 Exponential Distribution
Computing Probabilities for the Exponential
Distribution

As with any continuous probability distribution, the area

under the curve corresponding to some interval provides the
probability that the random variable takes on a value in that
interval. In order to compute exponential probabilities such
as those described, we make use of the following formulas:

P ( X  c)  1  e  c
P ( X  c)  e  c
P (c  X  d )  e  c  e  d 

Section 2 – Continuous Random Variable

Section 2.5 Exponential Distribution

Example:

Suppose X has
S h an exponentiali l distribution
di ib i with i h mean equall
to 10. Determine the following:

( a ) P ( X  10)
( b ) P ( X  20)
( c ) P (15  X  30)
( d ) Find the value of x such that P ( X  x)  0.95

56
Section 2 – Continuous Random Variable
Section 2.5 Exponential Distribution
Solution:
1
Given E ( X )    10     0.1
01


( a ) P ( X  10)  P( X  10)  e  (10)(0.1)  0.3679

( b ) P ( X  20)  P( X  20)  1  e  (20)(0.1)  0.8647

( c ) P (15  X  30)  P(15  X  30)

 e  (15)(0.1)  e  (30)(0.1)  0.1733

Section 2 – Continuous Random Variable

Section 2.5 Exponential Distribution

( d ) Find the value of x such that P ( X  x)  0.95

P ( X  x)  0.95

1  e  (0.1) x  0.95

e 0.1x  0.05

0.1x  ln(0.05)

x  29.957

57
Section 2 – Continuous Random Variable
Section 2.5 Exponential Distribution
Relationship Between the Poisson and Exponential
Distributions
Recall that the Poisson distribution,
distribution as a discrete probability
distribution, is often useful when dealing with the number
of occurrences of an event over a specified interval of time
or space.

The continuous exponential

p pprobability
y distribution is
related to the discrete Poisson distribution in that, whilst the
Poisson distribution provides an appropriate description of
the number of occurrences per interval, the exponential
distribution provides a description of the length of the
interval between occurrences.

Section 2 – Continuous Random Variable

Section 2.5 Exponential Distribution

To provide an example that illustrates this relationship,

suppose
pp that the number of cars that arrive at a car wash
during 1 hour is described by a Poisson probability
distribution with a mean of 10 cars per hour.

Thus the Poisson probability function that provides the

probability of x arrivals per hour is

e    x e 10 (10) x
f ( x)  P( X  x)  
x! x!

58
Section 2 – Continuous Random Variable
Section 2.5 Exponential Distribution
Since the average number of arrivals is 10 cars per hour, the
average time between cars arriving is

1 hour
 0.1 hour / car
10 cars

Thus the corresponding exponential distribution that

describes the time between the arrival of cars has a mean of
  1 /   0.1 hour per car. Thus the exponential
probability density function that give the time y hours
between arrivals is
f ( y )  10e 10 y

Section 2 – Continuous Random Variable

Section 2.5 Exponential Distribution
Example:
The number of customers arriving at a teller’s window at a
b k follows
bank f ll the
h Poisson
P i di ib i with
distribution i h a mean rate off
  0.75 customer per minute. If the time between arrivals
is less than or equal to three minutes, then the teller can
provide banking services without irritating customers with
annoying waiting times.

( a ) Find the mean and standard deviation of the time X

between customer arrivals at the teller’s window.
( b ) Find the proportion of customers for whom the teller
provides service without an annoying delay.

59
Section 2 – Continuous Random Variable
Section 2.5 Exponential Distribution
Solution:
( a ) Find the mean and standard deviation of the time X
between customer arrivals at the teller
teller’ss window.
Since the number of arrivals in one minute has a Poisson
distribution, the time between arrivals is exponentially
distributed.

The mean and standard deviation of the exponential X is

1 1
E( X )    1.33 min / arrival
 0.75 arrival/min
1
Var ( X )   (1.33) 2   X  Var ( X )  1.33
 2

Section 2 – Continuous Random Variable

Section 2.5 Exponential Distribution

( b ) Find the proportion of customers for whom the teller

pprovides service without an annoying
y g delay.
y

The teller can provide services without an annoying delay

if X  3 minutes. Thus, the required probability is

P ( X  3)  1  e 3/1.33  0.895

Consequently, about 89.5% of the customers will not be

irritated by an annoying delay.

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