Topic 6 QBA241 2015

6. Discrete Probability Distributions

The probability distributions can be categorized into two types:

Probability Distributions

Discrete Continuous

Binomial Normal

Poisson

6.1 Binomial Probability Distribution

The binomial distribution is the result of a binomial experiment, which has the following
properties.

Binomial Experiment

 A fixed number of trials, n

 ex. 15 tosses of a coin; 10 light bulbs taken from a warehouse
 Two mutually exclusive outcomes
 ex. head or tail in each toss of a coin; defective or not defective light bulb; having a
boy or girl
 Generally the outcomes are called “success” and “failure”
 Probability of success is p, probability of failure is q = (1 – p)
 Constant probability for each observation
 ex. Probability of getting a tail is the same each time we toss the coin
 Observations are independent
 The outcome of one observation does not affect the outcome of the other

Applications of binomial distribution:

 A manufacturing plant labels items as either defective or acceptable

 A firm bidding for contracts will either get a contract or not
 A marketing research firm receives survey responses of “yes I will buy” or “no I will not”
 New job applicants either accept the offer or reject it

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Topic 6 QBA241 2015

The binomial random variable is the number of successes in an experiment’s “n” trials. It can take
on values from 0, 1, 2,…. until n. Thus, the random variable is discrete.

If X is a binomial random variable, then X ~ B ( n , p )

The objective of this lesson is to compute the probability associated with each value.

Binomial Probability Distribution

The probability of X successes in a binomial experiment with n trials and p is

( ) ( ) ( )
( )

for x = 0, 1, 2, ….., n

( )

The combinatorial formula can be simplified using nCr function on a scientific calculator. Hence, the
formula can be re-written as follows:

Binomial Probability Distribution

The probability of X successes in a binomial experiment with n trials and p is:

X~B(n,p)

( ) ( ) ( )

for x = 0, 1, 2, ….., n

where q = (1 – p)

Expected Value (Mean)

( )

Variance Standard Deviation

( ) √

Discrete Probability Distributions 48 HH

Topic 6 QBA241 2015

Example 6.1

From past experience, a manager of an upscale shoe store knows that 85% of her customers will
use a credit card when making purchases. Suppose three customers are in line to make a purchase.
a) Define the random variable of X and its distribution.
b) What is the probability that none of them will use a credit card when making purchases?
c) What is the probability that at least one customer will use a credit card when making purchases
d) What is the probability that all three customers will use a credit card when making purchases?
e) What is the expected number of customers who will use a credit card when making purchases?

Solution
a) X is the number of customers who will use a credit card when making purchases
X ~ B(n = 3, p = 0.85)

b) P(X = 0) = 3C0 (0.85)0 (1 – 0.85)3-0

= (1)(1)(0.015625) = 0.015625 ~ 1.56%.
The chances of none of them will use a credit card when making purchases are very small
(1.56%).

c) P(X ≥ 1) = 1 – P(X = 0) = 1 - 0.015625 = 0.9844.

The chances that at least one customers will use a credit card when making purchases are
almost perfect.

d) P(X = 3) = 3C3 (0.85)3 (1 – 0.85)3-3

= (1)(0.614125)(1) = 0.614125 ~ 61.41%.
The chances of all three customers will use a credit card when making purchases are quite high
(61.41%).

e) E(X) = µ = np = 3(0.85) = 2.55

Discrete Probability Distributions 49 HH

Topic 6 QBA241 2015

6.2 Poisson Probability Distribution

Another important discrete probability distribution is the Poisson distribution, named after a
French mathematician Siméon Denis Poisson.

The Poisson random variable is the number of occurrences of events (also called successes) in an
interval of time or specific region of space.

Examples:

 The number of cars arriving at a gas station in 1 hour. (The interval of time is 1 hour.)
 The number of typo errors in a page. (The specific region of space is 1 page.)
 The number of accidents every 5 km on a particular stretch of highway. (The specific region
of space is 5 km.)
 The number of insurance sold weekly. (The interval of time is 1 week.)

Poisson Experiment

 The number of successes that occur in any interval is independent of the number of
successes that occur in any other interval.
 The probability of a success in an interval is the same for all equal-size intervals.
 The probability of a success in an interval is proportional to the size of the interval.
 The probability of more than one success in an interval approaches 0 as the interval
becomes smaller.

If X is a Poisson random variable, then X ~ P ( µ ) where the random variable of X can take on values
from 0, 1, 2, ……, n.

The objective of this lesson is to compute the probability associated with each value.

Poisson Probability Distribution

( )

Mean

( )

Variance Standard Deviation

Discrete Probability Distributions 50 HH

Topic 6 QBA241 2015

Example 6.2

A statistics instructor has observed that the number of typographical errors in new editions of
textbooks varies considerably from to book. After some analysis, he concludes that the number or
of errors is Poisson distributed with a mean of 1.5 per 100 pages. The instructor randomly selects
100 pages of a new book.

a) What is the probability that there are no typographical errors in a 100-page book?
b) What is the probability that there are two typographical errors in a 100-page book?
c) What is the probability that at least one typographical errors in a 100-page book?

Solution
a) X ~ P(µ = 1.5 pages per 100 pages)
( )
( )
The probability that in the 100 pages selected there are no errors is 22.3%.
b)
( )
( )
The probability that in the 100 pages selected there are two errors is 25.1%.

b) P(X ≥ 1) = 1 – P(X = 0) = 1 – 0.2231 = 0.7769

The probability that in the 100 pages selected there are at least one errors is 77.69%.

Discrete Probability Distributions 51 HH

Topic 6 QBA241 2015

SELF-TEST EXERCISES

1. The percentage of customers who enter a restaurant and ask to be seated in a smoking section
is 15%. There are 12 people who are entering the restaurant.
a) What is the expected number of people who request for a smoking table?
b) What is the standard deviation of the number of requests for a smoking table?

2. Approximately 10% of people are left-handed. If there are 10 people:

a) Define the random variable of X and its distribution.
b) What is the probability that at least one of them are left-handed?

3. Clueless Dude does not read the textbook before class, does not do homework and regularly
misses class. He is about to sit for a test which he intends on relying on luck to pass the test. The
test consists of 10 multiple choice questions. Each question has five possible answers only one
of which is correct. In this test, a mark less than 5 is considered a failure.
a) What is the probability a correct answer out of the five possible answers?
b) What is the probability that Dude fails the test?
c) What is the number of correct answers that Dude expects to obtain?

4. Along a typical stretch of highway, 5% of the car drivers usually run over the red traffic light.
10% of the car drivers will be seen talking on the mobile phone while driving. 30% of the car
drivers will exceed the speed limit. Suppose that there are 10 cars on the highway.
a) What is the probability that 2 cars run over the red traffic light?
b) What is the probability that at least one driver is on the mobile phone?
c) What is the probability that 5 cars exceed the speed limit?

5. The number of arrivals at a car wash is Poisson distributed with a mean of 2 per minute.
a) Define the random variable of X and its distribution.
b) What is the probability that no car will arrive in the next minute?
c) What is the probability that 8 cars will arrive in the next minute?

6. The number of accidents that occur at a busy intersection is Poisson distributed with a mean of
3.5 per week.
a) Define the random variable of X and its distribution.
Find the probability of the following events.
b) No accidents in one week
c) At least one accidents in one week

7. During a typical football game, a coach can expect 3.2 injuries. Suppose that the number of
injuries follow Poisson distribution. Find the probability that the team will have at most 1 injury
in this game.

Discrete Probability Distributions 52 HH