Probability:

Basic Counting Techniques – Permutations and Combinations

Permutations deals with arrangements:

If one thing can be done in n1 ways and second can be done in n2 ways and third in n3 ways and
so forth, then the number of different ways in which they can be done is:

n1 x n2 x n3 … nx ways

If one has to arrange an array of (n numbers or characters) in to different orders then the
number of permutations of n objects can be done using following formula: where P is permutation
n
Pn = n!

When there is a scenario of arranging n different object taken r times.

n
Pr = n! / (n-r)!

When there is a scenario of arranging when repetition is allowed

n
Pr = nr

When there is a scenario of arranging when they are not all different

P= n!/n1!. n2!. n3!. nk!

Combination deals with selection:

Combination means selection consisting of ‘r’ objects chosen from ‘n’ different objects.
n
Cr = n! / r!(n-r)!
Regression
The dependence of one variable on the other variable is termed as regression. Regression is a statistical
device or procedure that helps estimating the value of one variable when the other variable is provided.

The variable whose value is to be determined is called dependent variable Y

The variable whose value is given is called independent variable X

When the two variable are found strongly to be related, and are put through a mathematical equation
as below:

For linear relationship Y=a+bX

When value of Y is required on X (Y on X), b=n ∑XY-(∑X) (∑Y) / n∑X2-(∑X)2

and a = y̅ –bx̅ , y̅ = ∑Y/n and x̅ = ∑X/n

Similarly when value of X is required on Y (X on Y), d=n ∑XY-(∑X) (∑Y) / n∑Y2-(∑Y)2

and c = x̅ –d y̅, y̅= ∑Y/n and x̅=∑X/n

is called regression equation. In above equation: ‘a’ is called the regression constant and ‘b’ is called the
regression coefficient.

Coefficient of Correlation: The coefficient of correlation is the numerical measure of strength of the
linear relationship between two variables. It is denoted by r and is defined as:

r = n ∑XY – (∑X)( ∑Y) / √n ∑ X 2 − (∑X)2 √n ∑ Y 2 − (∑Y)2

Estimation

Estimation means to estimate the unknown value of a population parameter by help of sample data.

Estimator stands for the rule or formula that is used to estimate a parameter whereas an estimate
stands for the numerical value obtained by substituting the sample observation in the formula.

x̅=1+2+3/3 = 2, 2 is estimate or and formula is estimator

When an estimate for the unknown population parameter is expressed by single value it is called point
estimate.

Point estimate= Avg. height of random sample of 40 students i.e x̅=63

Interval estimate = Avg. height is between 61’’ and 65’’

Confidence interval is the degree of confidence on the value that lie between the upper and lower value
of interval estimate. If the confidence interval is 95% then the probability that interval contains the true
parameter value out 100 is 95.

CASE I - Confidence interval for population mean µ (if σ is unknown, n≥ 30 replace σ by s)

When SD of population (σ) is known

Then a (1-α) 100% confidence interval for µ is

𝜎
x̅ ± 𝑍∝
2 √𝑛
CASE II - Confidence interval for population mean µ (if σ is unknown, n < 30)

When SD of population (σ) is unknown

Then a (1-α) 100% confidence interval for µ is

𝑠
x̅ ± 𝑡∝
2 √𝑛

(𝑥−x̅)2
Where x̅ = ∑X/n and s =√∑
𝑛−1

CASE III - Confidence interval for difference between two population mean µ

When S.D of population (i.e σ1 and σ2) are known (if σ is unknown, n1 and n2 ≥ 30 replace σ1 by
s1 and σ2 by s2)

Then a (1-α) 100% confidence interval for µ1 - µ2 is

𝜎12 𝜎22
(x̅1 - x̅2) = ± 𝑍∝ √ +
2 𝑛1 𝑛2
CASE IV - Confidence interval for difference between two populations mean µ

When S.D of population (i.e σ1 and σ2) are unknown (if σ is unknown, n1 and n2 < 30 replace σ1
by s1 and σ2 by s2)

Then a (1-α) 100% confidence interval for µ1 - µ2 is

1 1
(x̅1 - x̅2) = ± 𝑡∝ . 𝑆𝑝 √ +𝑛
2 𝑛1 2

and 𝑆𝑝 = pooled standard deviation

(𝑛1 −1)𝑠12 + (𝑛2 −1)𝑠22

𝑆𝑝 = √ 𝑛1 + 𝑛2 −2