Probability

Distributions:
Random Variable
Dr. Kishore Morya
  Random Variable: A variable that takes on different values
as a result of the outcomes of a random experiment.
 The possible outcomes of a chance situation are often numbers,
such as:
 The number of boys in a family chosen at random (0, 1, 2, 3, or 4)
Random  The maximum temperature in New Delhi on a particular day
 The percentage of respondents who vote BJP in an opinion poll
Variable  The marks given by a judge in a gymnastic competition
 The age of a student selected at random
 The number of telephone calls received by a receptionist in a day
 The time it takes an athlete to run 100m
  Discrete Random Variable: if a random variable is allowed to
take only a limited number of values, which can be listed.
 Examples:
Types of  The result of throwing a dice is a discrete random variable because
it can only take some of the values between 1 and 6 inclusive.
Random  The number of cars arriving at a toll booth in a 5-minute period.
Variable  The number of defective items in a batch
 The number of people queuing at a supermarket checkout
 The run scored by a batsman in a game of cricket
 The number of wickets taken by a bowler.
  If a variable is allowed to take any value within a range then
it is a continuous random variable.
Continuous  Examples:
 The minimum or maximum temperature of a city on a particular day.
Random  The amount of water used by a household in a day
Variable  Time to travel Jaipur from Delhi by Car
 Air contained in a tire of a car
 Change in share price of a script on BSE Sensex on a given day
  The depth of the sea at a randomly chosen point
 The number of phone calls received by a switchboard in a minute.
Check this:  The number of attempts an individual needs to pass their driving
Are the following test
 The price of a particular share at close of business tomorrow
random variables
 The number of students who pass an exam
continuous or
 The proportion of a large group of students who pass an exam
discrete
 The time taken for an athlete to run 200 meters
 The number of heads when a coin is tossed 10 times in succession
  The probability distribution of X, the number shown on a single
die, is:

X P(x)
1 1/6
2 1/6
Probability 3 1/6

Distribution 4
5
1/6
1/6
6 1/6
  A coin is tossed twice. What is the probability distribution of X,
the number of heads observed?

1st toss 2nd toss

Head Head
Head Tail
Tail Head
Probability Tail Tail

Distribution
x P(x)

0 ¼
1 1/2
2 1/4
  In a game I throw two fair coins. If I throw two heads my opponent
will give me Rupees 50, but if not, I must pay Rupees 20. The
probability distribution of X, the amount I gain, is:
Expected
Value or Gain x P(x)
of a Random 50 ¼

Variable -20 ¾

Would you play such as game?

 Suppose I play the game for 10000 times.
 Outcomes
 Two heads receive Rupees 50 for 10000 * ¼ times
 Other than two heads pay Rupees 20 for 10000 * ¾ times

 So, My Expected Value or Gain:

 (50 * 10000 * ¼ ) – (20 * 10000 * ¾ ) = - 25000

 Expected Gain of a single game:
-25000/10000 = -2.5 rupees.
  Take the example of a fruits and vegetable wholesaler who sells strawberries.
The product has very limited useful life. If not sold on the day of delivery, it is
worthless. One case of strawberries costs $20, and the wholesaler’s selling
price is $50. The leftover loss to the wholesaler is $20/case. The number of
Use of cases sold per day for 100 days is given in the following table:
Daily sales Number of days sold Probability of each
Expected 10 15
number being sold 10
0.15
Value in 11 20 0.20
Decision 12 40 0.40
13 25 0.25
Making Total 100 1

 How many cases of strawberries should the wholesaler stock so that minimum
loss occur?
 Possible Stock Option

Possible demand 10 11 12 13
for Strawberries
cases

Conditional 10 $0 $ 20 $ 40 $ 60

Loss Table 11 30 0 20 40

12 60 30 0 20

13 60 60 30 0
 Possible request Conditional loss Probability of this Expected Loss
demand
10 $0 * 0.15 = $ 0.00

Expected Loss 11
12
30
60
*
*
0.20 =
0.40 =
6.00
24.00
from stocking 13 90 * 0.25 = 22.50

10 cases Total 1.00 = $ 52.50

 Possible request Conditional loss Probability of this Expected Loss
demand
10 $ 20 * 0.15 = $ 3.00

Expected Loss 11
12
0
30
*
*
0.20 =
0.40 =
0.00
12.00
from stocking 13 60 * 0.25 = 15.50

11 cases Total 1.00 = $ 30.00

 Possible request Conditional loss Probability of this Expected Loss
demand
10 $ 40 * 0.15 = $ 6.00

Expected Loss 11
12
20 *
0*
0.20 =
0.40 =
4.00
0.00
from stocking 13 30 * 0.25 = 7.50

12 cases Total 1.00 = $ 17.50

 Possible request Conditional loss Probability of this Expected Loss
demand
10 $ 60 * 0.15 = $ 9.00

Expected Loss 11
12
40 *
20 *
0.20 =
0.40 =
8.00
8.00
from stocking 13 0 * 0.25 = 00.00

13 cases Total 1.00 = $ 25.00