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Understanding Expected Value & Distributions

The document explains the concept of expected value in statistics, illustrating it with a multiple-choice test example. It also describes the Normal distribution, its properties, and the significance of standard deviations in relation to data spread. Additionally, it outlines the Binomial distribution and its key properties, including mean, variance, and standard deviation calculations.

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dandamshravanthi0205
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20 views23 pages

Understanding Expected Value & Distributions

The document explains the concept of expected value in statistics, illustrating it with a multiple-choice test example. It also describes the Normal distribution, its properties, and the significance of standard deviations in relation to data spread. Additionally, it outlines the Binomial distribution and its key properties, including mean, variance, and standard deviation calculations.

Uploaded by

dandamshravanthi0205
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Expected value:

In statistics and probability analysis, the expected


value is calculated by multiplying each of the possible
outcomes by the likelihood each outcome will occur and
then summing all of those values.
For example, if you take a 20 question multiple-choice test
with A,B,C,D as the answers, and you guess all “A”, then you
can expect to get 25% right (5 out of 20).

The math behind this kind of expected value is:


The probability (P) of getting a question right if you guess:
0.25
The number of questions on the test (n)*: 20
P x n = .25 x 20 = 5
The Normal distribution is defined by the following
probability density function, where μ is the population mean
and σ2 is the variance.
 A normal distribution is
the proper term for a
probability bell curve.

 In a normal
distribution the mean is
zero and the standard
deviation is 1.
Many things closely follow a Normal
Distribution:
 heights of people
 size of things produced by machines
 errors in measurements
 blood pressure
 marks on a test
The Normal Distribution has:
 mean = median = mode
 symmetry about the center
 50% of values less than the mean
and 50% greater than the mean
Standard Deviations :
The Standard Deviation is a measure of how spread out
numbers are. When we calculate the standard deviation we
find that generally.

68% of values are


within
1 standard
deviation of the mean
95% of values are within
2 standard
deviations of the mean

99.7% of values are within


3 standard deviations of
the mean
Example: 95% of students at school are between 1.1m and
1.7m tall.
Answer: Assuming this data is normally distributed can
you calculate the mean and standard deviation?
The mean is halfway between 1.1m and 1.7m:
Mean = (1.1m + 1.7m) / 2 = 1.4m

95% is 2 standard deviations either side of the mean (a total


of 4 standard deviations) so:
1 standard deviation
= (1.7m-1.1m) / 4
= 0.6m / 4
= 0.15m
R functions of Normal Distribution:
dnorm(x, mean = 0, sd = 1, log = FALSE)
pnorm(q, mean = 0, sd = 1, [Link] = TRUE
qnorm(p, mean = 0, sd = 1, [Link] = TRUE)
rnorm(n, mean = 0, sd = 1)
Arguments
x, q vector of quantiles.
p vector of probabilities.
n number of observations.
mean vector of means.
Sd vector of standard deviations.
Binomial distribution formula:
The Binomial Distribution properties:
 The number of observations n is fixed.
 Each observation is independent.
 Each observation represents one of two
outcomes ("success" or "failure").
 The probability of "success" p is the same for
each outcome.
The binomial distribution has the
following properties:

 The mean of the distribution (μx) is equal to n *

P.

 The variance (σ2x) is n * P * ( 1 - P ).

 The standard deviation (σx) is sqrt[ n * P * ( 1 - P )

].

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