Applied Statistics - Lecture Summary Uniform Distribution fal width At X ~U(a,b) “The probability of falling @ particular interval is proportional to that interv then the pdfis given by . =Oelswhere i Thus BCX) = (@tby2 VOX) “(b-a)"12 Binomial Distribution ‘The binomial distribution deseribes the behavior of a count variable if the sumber of observations n (say) is fixed and each observation has only two outcomes ("success OF failure"), Further, each observation is assumed to be independent, The probability “success” = pis the same for each outcome. If ¥ ~B (vy p) then POY =1) = C2 (p)(1-p)™ where p~ probability of success, n= number of trials EQ) =np VeYnp(l-p) cn (i) Ifthe likelihood of a tagged order form is 0.1, what is the probability that there are three tagged order forms in the sample of four? (2) In clinical trials a certain drug has an 8% success rate of curing a known disease. If 15 people are known to have the disease, What is the probability of at least 2 being cured. Poissoxi Distribution ‘The Poisson distribution is also a discrete distribution which is used to model the number of events ocourring within a given time interval,IfY ~ P(A) then P(Y = y) = = for y= 01,2, and is denoted by yw 2. ib the average number of events in the given time interval and it is known as the “sha pe parameter of the distribution”. E(Y)= 4 = V(Y) cE (D The average number of customers arriving during 12.00 noon to 1,00 pm at a city bank is 180. What is the probability that in a given minute exactly two customers will arrive? ‘What is the probability that in a given minute more than two customers will arrive? (2) The number of work related injuries per month in a manufacturing plant is know to follow a Poisson dist. with ¢ mean of 2.5 work related injuries a month, What is the probability that in a given month no work related injuries occur? (3) Assuming that the mumber of network errors experienced in a day on a local area net work is distributed as a Possion rv. The mean number of network errors experienced in a day is 2.4. ‘What is the probability that in any given day 2 or more net work errors will ocour? Exponential Distribution This is a continuous distribution that is right skewed and varies fiom 0 to positive infinity. This is a continuous distribution and is useful in many occasions in particularly in business. It is widely used in waiting line (or queuing) theory to model the length of time between arrivals in process such as customers at Bank ATMs, customers at a fast food restaurant, patients entering to a accident ward, It is defined using a single parameter:2., if Y~ Exp(A) then fly) = Ae™, ify>0 =0 otherwise EY) = a Pos) e™ and so PK > 1)Veetrood garna-dettbuted random vate Normal Distribution ‘The normal distribution is the most important family of eéntinuous probability distributions in statistics which is widely applicable in all fields, The distribution is defined by two parameters, namely “mean -("average", 2) and variance ("variability", 0”). The normal distribution, is known es the Gaussian distribution and is denoted by Y~ N(h,07)- PDF of the Normal distribution is given by xx) = te enol Soeeeereetity Note: If ¥~ N(p,07) then E(Y)=jtand V(Y)= Standard normal distribution s In general all normal random variables are converted to the standard normal, If X~ N(j.0"), X-z EZ) = 0 and V(Z) =1 Thus it is written as Z~ N(0,1). An important consequence is that the 1 x distribution function of a general normal distribution is given by ~-—expl-— >" a alven by a i then Z isa standard normal distribution. It can be shown that Normal ‘The length of life of a type of automatic washer is approximately normally distributed with mean and sd of 3.1 and 1.2 years respectively. If this type of washer is guarantee for one year What fraction of original sales will require replacement? ‘A used car dealership has found, that for the cars it sells, the length of time before a major repair is normally distributed with mean of 10 months and sd of 3 months. If the dealer wants only 5% of the cars to fail before guarantee time, for how long (in months) should the cers be guaranteed? ‘A municipal council has installed 2000 lamps in the streets of its city area. The life time of the bulbs are normaly distributed with mean 900 hrs and sd_of 150 hrs. How many of theseCIE. (1) Suppose that the customers arrive at a bank’s ATM at the rate 20 per hour. Ifa customer has just arrived, what is the probability that the next customer arrive within 6 minutes ? Let X= time taken between 2 arrival (hrs) s then E(X)=1/20 hrs X~ E(A)= E(20) PO <0.1)2 1-e" = (1—e*) =0.8647 (2) Telephone calls arrive at the information desk of a large computer software company at a rate of 15 per hour. What is the probability that the next call will arrive within (a) 3 mts and (b) within 15 mts. @) The time between unplanned shutdowns of a power plant has an exponential distribution swith a mean of 20 days. Find the probability thet the time between two unplanned shutdowns is (a) less than 14 days and (b0 more than 21 days. Gamma Distribution Gamma distribution is used to explain variables which are skewed. However, unlike normal distribution probability tables are, not readily available for this distribution. The gamma distribution is a two-parameter family of continuous probability distributions. It has @ scale parameter 2. and ashape parameter 0. Thus X~ ['(A,0) The pdf's given by oie te ae (7820 an fa) otherwise BOQ = 2 =-2 Note: E(X) x and V(X) @ f@)= “The special case of Gamma distribution when the shape parameter @=1 is called the exponential distribution. Applications of the gamma distribution ‘This heavy used in climatology studies due to its moderately skewed profile Also for modelling insurance claims, the size of loan defaults etc Gamma dist is used.bulbs can be expected to fail between 600 and 1100 burning hours? After What number of burning hours would you expect (i) that 5% bulbs would fail? and (ii) 200 bulbs are still in good condition? Identification of Normality ~ Crude method In a norma! distribution an actual sample statistic lying in the interval pto, wt2o and 430 (= 0 and 61 for std normal) about 68%, 95% and 99% confidence, Hypergeometric Distribution Both the binomial distribution and the hyper geometric distribution are concerned with the number of events in a sample containing n observations. For the Binomial the sample data are selected with replacement from a finite population (or without replacement from an infinite Population). Thus, the probability of an event of interest is constant over all observations and ‘outcome of any particular observation is independent of any other. In contrast in Hypergeometric _distributiori the sample data are selected_without replacement from a finite population, Thus the outcome of one observation is dependent on the outcomes of the previous observations. Oc) ©) won where N=Population size, A= total # of size interested in the population, n=sample size If X~HG(n,N, A) = P(X = x/n.N.A) £00 = 4 and VO) = Ex. 1, You are formimg a team of 8 managers from different department in your company. The ‘company has 30 mangers and 10 of those ate ftom IT dept, If you select managers randomly for the team what is the probability thet the team will contain 2 managers from IT dept? 2. A batch of 100 computer chips contains 10 defective chips. Five chips are chosen at random, without replacement. Find each of the following: (i) The probability that the sample ‘contains one defective chip, (i) The probability that the sample contains at least one defective chip and (ii): The probability density function of the number of defective chips in the sample. : ‘Moment and Moment Generating Function (MGF) Moment In probability theory and statistics, the mathematical expectation js called the moments of the distribution of a random variable. The r moment of a r.v, X (with mean zero) is denoted by 1; and it is defined as Hy = EX) where r= 12,3, 0 ‘Thus, wy, = E(XT)= Six" P(x) ; when X is discrete