Statistics Summary

PERMUTATIONS AND COMBINATIONS PROBABILITY

The number of permutations of r objects, taken from PROBABILITY
a set of n distinct objects without replacement is
given by For two events A and B,
P(A B)=P(A)+P(B)-P(A B)
n n!
Pr = P(A)=P(A B)+P(A B')
(n-r)!
MUTUAL EXCLUSIVITY
The number of permutation of r objects, taken from a Mutually exclusive events cannot occur at the same
set of n distinct objects with replacement is given by time. For two mutually exclusive events, E1 and E2,
nr P(E1 E2 )=P(E1 )+P(E2 )
The number of permutations of n distinct objects in a CONDITIONAL PROBABILITY
circle is given by
P(A B)
(n-1)! P(A|B)=
P(B)
The number of possible combinations of r objects, INDEPENDENCE
taken from a set of n distinct objects without
replacement is given by Independent events are events the occurrences of
n! which do not influence the probability of the
n
Cr = occurrence of the other event.
(n-r)!r!
For independent events,
P(A|B)=P(A) or P(B|A)=P(B)
P(A B)=P(A)P(B)

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 Statistics Summary

RANDOM VARIABLES
For any random variable X,
CONTINUOUS RANDOM VARIABLES
The expectation, , is given by
E(X)= xP(X=x) NORMAL DISTRIBUTI ON

and E(aXbY) = aE(X) bE(Y) For a random variable X modelled by a normal

distribution with mean and standard deviation
2
The variance is given by X~N(, )
Var(X)=E[(X-)2 ]= (x-) P(X=x)
2
STANDARD NORMAL VARIABLE
2 2
and Var(aXbY)=a Var(X) + b Var(Y) Letting X~N(,2), the standard normal variable Z is
defined as
The standard deviation, , is given by x-
Z= ~N(0,1) and
= Var(X) x-
P(Xx) = P(Z )

DISCRETE RANDOM VARIABLES APPROXIMATIONS

Approximations marked are to be continuity corrected
BINOMIAL DISTRIBUTIO N
For a random variable X modelled by a binomial BINOMIAL TO POISSON
distribution with n trials and probability of success, p For X~B(n,p)
X~B(n,p) If n is large (n > 50) and p is small (p < 0.1) such that
np < 5, then X~Po(np)
Its probability distribution is given by
n x n-x BINOMIAL TO NORMAL
P(X=x)= Cxp (1-p)
For X~B(n,p)
Its mean and variance are given by In is large such that np > 5 and n(1-p) > 5, then
E(X) = np X~N(np,np(1-p))
Var(X) = np(1-p)
POISSO N TO NORMAL
POISSON DISTRIBUTION For X~Po()
For a random variable X modelled by a Poisson If > 10, then X~N(, )
distribution with parameter
CONTINUITY CORRECTION
X~Po()
Its probability distribution is given by These are the ranges, for given probability
e- x distribution functions, to consider when
P(X=x)= approximating discrete random variables to
x!
continuous random variables.
Its mean and variance are given by
P(Xa)
E(X) = Var(X) =
P(X<a) P(x=a) P(X>a)
P(Xa)
Note also that for two Poisson random variables
X~Po(1) and Y~Po(2), a-1 a a+1
X+Y~Po(1+ 2)

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 Statistics Summary

SAMPLING
SAMPLE MEAN UNBIASED ESTIMATOR OF SAMPLE MEAN
The sample mean from a normal population For any sample size n taken from a population with an
2
of sample size n with mean and variance unknown mean , the unbiased estimator of is given by
is given by
x=
x = (x-a) + a
2 n n
X~N(, )
n where a is a constant
CENTRAL LIMIT THEOREM UNBIASED ESTIMATOR OF SAMPLE VARIANCE
The central limit theorem states that, for a For any sample size n taken from a population with an
non-normal population with sample size n, unknown mean 2, the unbiased estimator of 2 is given by

2 ( )
2
1 x 1
2
X~N(, ) approximately, if n is large (50).
n
2
s =
n-1
x - n = n-1 (x-x)2

2 (
(x-a) )
2
1
=
n-1
(x-a) - n

where a is a constant

HYPOTHESIS TESTING
CONDUCTING A HYPO THESIS TEST
Step 1: State the null and alternative hypotheses H0 and H1
Step 2: State the significance level,
Step 3: Determine the test statistic to use and its distribution
Step 4: Calculate the p-value for the test statistic
Step 5: Indicate whether or not to reject H0 based on the evidence from the sample
H0 is rejected if p-value <
H0 is not rejected if p-value >
TEST STATISTICS
Normal Population Non-normal Population
2 known 2 unknown 2 known 2 unknown
by the CLT by the CLT
Sample size is large 2 s2 2
X~N(, ) X~N(, ) s2
n50 n n X~N(, ) X~N(, )
n n
Test Statistic Z-test Z-test Z-test Z-test
2
Sample size is small X~N(, ) T~t(n-1)
n
Test statistic Z-test t-test

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