Discrete Probability Distribution

Chapter 5
Discrete Probability Distributions

 Random Variables
 Discrete Probability Distributions
 Expected Value and Variance
 Binomial Probability Distribution .40
 Poisson Probability Distribution .30
.20
.10
0 1 2 3 4
© 2008 Thomson South-Western. All Rights Reserved Slide

1
Random Variables
A
A random
random variable
variable is
is aa numerical
numerical description
description of
of the
the
outcome
outcome of
of an
an experiment.
experiment.
A
A discrete
discrete random
random variable
variable may
may assume
assume either
either aa
finite
finite number
number of
of values
values or
or an
an infinite
infinite sequence
sequence of
of
values.
values.
A
A continuous
continuous random
random variable
variable may
may assume
assume any
any
numerical
numerical value
value in
in an
an interval
interval or
or collection
collection of
of
intervals.
intervals.

2
Example: JSL Appliances
 Discrete random variable with a finite number

of values
Let
Let xx == number
number of
of TVs
TVs sold
sold at
at the
the store
store in
in one
one day,
day,
where
where xx can
can take
take on
on 55 values
values (0,
(0, 1,
1, 2,
2, 3,
3, 4)
4)

3
Example: JSL Appliances
 Discrete random variable with an infinite sequence

of values
Let
Let xx == number
number of
of customers
customers arriving
arriving in
in one
one day, day,
where
where xx can
can take
take on
on the
the values
values 0,
0, 1,
1, 2,
2, .. .. ..
We can count the customers arriving, but there is no

finite upper limit on the number that might arrive.

4
5
6
Random Variables
Question Random Variable x Type

Family x = Number of dependents Discrete
size reported on tax return
Distance from x = Distance in miles from Continuous

home to store home to the store site
Own dog x = 1 if own no pet; Discrete
or cat = 2 if own dog(s) only;
= 3 if own cat(s) only;
= 4 if own dog(s) and cat(s)

7
Developing Discrete Probability Distributions
The
The probability
probability distribution
distribution for
for aa random
random variable
variable
describes
describes how
how probabilities
probabilities are
are distributed
distributed over
over
the
the values
values of
of the
the random
random variable.
variable.
We can describe a discrete probability distribution

with a table, graph, or equation.

8
 Classical method
 Subjective method leads to different prob.

Distributions

9
 The use of the relative frequency method to develop

discrete probability distributions leads to what is
called an empirical discrete distribution.
54
f(0) 117
72
42
12
3
300

10
The
The probability
distribution is
is defined
defined byby aa
probability
probability function,
function, denoted
denoted byby f(x),
f(x), which
which provides
provides
the
the probability
probability for
for each
each value
value ofof the
the random
random variable.
variable.
The required conditions for a discrete probability

function are:
f(x) > 0
f(x) = 1

11
 Using past data on TV sales, …

 a tabular representation of the probability
distribution for TV sales was developed.
Number 80/200
Units Sold of Days x f(x)
0 80 0 .40
1 50 1 .25
2 40 2 .20
3 10 3 .05
4 20 4 .10
200 1.00
Empirical discrete probability distribution

12
 Graphical Representation of Probability Distribution
.50
.40
Probability
.30
.20
.10
0 1 2 3 4
Values of Random Variable x (TV sales)

13
Discrete Uniform Probability Distribution
The
The discrete
discrete uniform
uniform probability
distribution is
is the
the
simplest
simplest example
example of
of aa discrete
discrete probability
probability
distribution
distribution given
given by
by aa formula.
formula.
The
The discrete
discrete uniform
uniform probability
probability function
function is
is
f(x) = 1/n the values of the

random variable
are equally likely
where:
n = the number of values the random
variable may assume
Problems
14
Expected Value and Variance
The
The expected
expected value,
value, or
or mean,
mean, of
of aa random
random variable
variable
is
is aa measure
measure of
of its
its central
central location.
location.
E(x) =  = xf(x)
The
The variance
variance summarizes
summarizes the
the variability
variability in
in the
the
values
values of
of aa random
random variable.
variable.
Var(x) =  2 = (x - )2f(x)
The
The standard deviation, ,, is
standard deviation, is defined
defined as
as the
the positive
positive
square
square root
root of
of the
the variance.
variance.

15
 Expected Value
x f(x) xf(x)
0 .40 .00
1 .25 .25
2 .20 .40
3 .05 .15
4 .10 .40
E(x) = 1.20
expected number of
TVs sold in a day
What will be sales for a month ?
30*1.20=36
16
 Variance and Standard Deviation
x x- (x - )2 f(x) (x - )2f(x)

0 -1.2 1.44 .40 .576
1 -0.2 0.04 .25 .010
2 0.8 0.64 .20 .128
3 1.8 3.24 .05 .162
TVs
4 2.8 7.84 .10 .784 squared
Variance of daily sales = s 2 = 1.660
Standard deviation of daily sales = 1.2884 TVs
Problems
weighted squared deviations
17
18
19
Binomial Distribution
 Four Properties of a Binomial Experiment

1. The experiment consists of a sequence of n
identical trials.
2. Two outcomes, success and failure, are possible

on each trial.
3. The probability of a success, denoted by p, does

not change from trial to trial.
stationarity
4. The trials are independent. assumption
Bernoulli process (2,3,4) and Binomial Experiment (1,2,3,4)

20
Our interest is in the number of successes

occurring in the n trials.
We let x denote the number of successes

occurring in the n trials.

21
Martin Clothing Store Problem
 Let us consider the purchase decisions of the next

three customers who enter the Martin Clothing Store.
 On the basis of past experience, the store manager

estimates the probability that any one customer will
make a purchase is .30. What is the probability that
two of the next three customers will make a
purchase?

22
Check
 1. The experiment can be described as a sequence of

three identical trials, one trial for each of the three
customers who will enter the store.
 2. Two outcomes—the customer makes a purchase
(success) or the customer does not make a purchase
(failure)—are possible for each trial.
 3. The probability that the customer will make a
purchase (.30) or will not make a purchase (.70) is
assumed to be the same for all customers.
 4. The purchase decision of each customer is
independent of the decisions of the other customers.

23
24
25
26
27
28
29
© 2008 Thomson South-Western. All Rights Reserved Excel
Slide
30
31
 Binomial Probability Function
n!
f (x)  p x (1  p )( n  x )
x !(n  x )!
where:
f(x) = the probability of x successes in n trials
n = the number of trials
p = the probability of success on any one trial

32
 Binomial Probability Function
n!
f (x)  p x (1  p )( n  x )
x !(n  x )!
Probability of a particular
Number of experimental sequence of trial outcomes
outcomes providing exactly with x successes in n trials
x successes in n trials

33
 Example: Evans Electronics

Evans is concerned about a low retention rate for
employees. In recent years, management has seen a
turnover of 10% of the hourly employees annually.
Thus, for any hourly employee chosen at random,
management estimates a probability of 0.1 that the
person will not be with the company next year.

34
 Using the Binomial Probability Function

Choosing 3 hourly employees at random, what is
the probability that 1 of them will leave the company
this year?
Let: p = .10, n = 3, x = 1
n!
f ( x)  p x (1  p ) (n  x )
x !( n  x )!
3!
f (1)  (0.1)1 (0.9)2  3(.1)(.81)  .243
1!(3  1)!

35
 Tree Diagram
1st Worker 2nd Worker 3rd Worker x Prob.
L (.1) 3 .0010
Leaves (.1)
S (.9) 2 .0090
Leaves
(.1) L (.1) 2 .0090
Stays (.9)
S (.9) 1 .0810
L (.1) 2 .0090
Leaves (.1)
Stays S (.9) 1 .0810
(.9) L (.1)
1 .0810
Stays (.9)
S (.9) 0 .7290

36
 Using Tables of Binomial Probabilities

p
n x .05 .10 .15 .20 .25 .30 .35 .40 .45 .50
3 0 .8574 .7290 .6141 .5120 .4219 .3430 .2746 .2160 .1664 .1250
1 .1354 .2430 .3251 .3840 .4219 .4410 .4436 .4320 .4084 .3750
2 .0071 .0270 .0574 .0960 .1406 .1890 .2389 .2880 .3341 .3750
3 .0001 .0010 .0034 .0080 .0156 .0270 .0429 .0640 .0911 .1250

37
 Expected Value
E(x) =  = np
 Variance
Var(x) =  2 = np(1 - p)
 Standard Deviation
  np(1  p )

38
 Expected Value
E(x) =  = 3(.1) = .3 employees out of 3
 Variance
Var(x) =  2 = 3(.1)(.9) = .27
 Standard Deviation
  3(.1)(.9)  .52 employees

39
Poisson Distribution
A
A Poisson
Poisson distributed
distributed random
random variable
variable is
is often
often
useful
useful in
in estimating
estimating the
the number
number of of occurrences
occurrences
over
over aa specified
specified interval
interval of
of time
time or
or space
space
It
It is
is aa discrete
discrete random
random variable
variable that
that may
may assume
assume
an
an infinite
infinite sequence
sequence of
of values
values (x
(x == 0,
0, 1,
1, 2,
2, .. .. .. ).).

40
Examples of a Poisson distributed random variable:
the
the number
number of
of knotholes
knotholes in
in 14
14 linear
linear feet
feet of
of
pine
pine board
board
the
the number
number ofof vehicles
vehicles arriving
arriving at
at aa
toll
toll booth
booth in
in one
one hour
hour

41
 Two Properties of a Poisson Experiment

1.
1. The
The probability
probability of
of an
an occurrence
occurrence is
is the
the same
same
for
for any
any two
two intervals
intervals of
of equal
equal length.
length.
2.
2. The
The occurrence
occurrence or
or nonoccurrence
nonoccurrence in
in any
any
interval
interval is
is independent
independent of
of the
the occurrence
occurrence or
or
nonoccurrence
nonoccurrence inin any
any other
other interval.
interval.

42
 Poisson Probability Function
 x e
f ( x) 
x!
where:
f(x) = probability of x occurrences in an interval
 = mean number of occurrences in an interval
e = 2.71828

43
An Example Involving Time Intervals
 Average no. of cars arriving in a 15-minute period

=10;
 If management wanted to know the probability of
exactly five arrivals in 15 minutes,
 probability of one arrival in a 3-minute period

44
45
 Example: Mercy Hospital

Patients arrive at the MERCY
emergency room of Mercy
Hospital at the average
rate of 6 per hour on
weekend evenings.
What is the
probability of 4 arrivals in
30 minutes on a weekend evening?

46
Poisson Distribution MERCY
 Using the Poisson Probability Function
 = 6/hour = 3/half-hour, x = 4
34 (2.71828)3
f (4)   .1680
4!

47
Poisson Distribution MERCY
 Poisson Distribution of Arrivals
Poisson Probabilities
0.25
0.20
Probability
0.15 actually,
the sequence
0.10 continues:
11, 12, …
0.05
0.00
0 1 2 3 4 5 6 7 8 9 10
Number of Arrivals in 30 Minutes

48
A
A property
property of
of the
the Poisson
Poisson distribution
distribution is
is that
that
the
the mean
mean and
and variance
variance are
are equal.
equal.
m=s2

49
MERCY
 Variance for Number of Arrivals

During 30-Minute Periods
m = s 22 = 3

50
51
Consider a Poisson distribution with a mean of two occurrences per time
period.
a. Write the appropriate Poisson probability function.
b. What is the expected number of occurrences in three time periods?
c. Write the appropriate Poisson probability function to determine the
probability of x occurrences in three time periods.
d. Compute the probability of two occurrences in one time period.
e. Compute the probability of six occurrences in three time periods.
f. Compute the probability of five occurrences in two time periods.

52
2 x e 2
a. f ( x) 
x!
b.  = 6 for 3 time periods

6 x e6
c. f ( x) 
x!
22 e2 4(.1353)
d. f (2)    .2706
2! 2
66 e6
e. f (6)   .1606
6!
45 e4
f. f (5)   .1563
5!

53
 Phone calls arrive at the rate of 48 per hour at the
reservation desk for Regional Airways.
 a. Compute the probability of receiving three calls in
a 5-minute interval of time.
 b. Compute the probability of receiving exactly 10
calls in 15 minutes.
 c. Suppose no calls are currently on hold. If the agent
takes 5 minutes to complete the current call, how
many callers do you expect to be waiting by that
time? What is the probability that none will be
waiting?
 d. If no calls are currently being processed, what is
the probability that the agent can take 3 minutes for
personal time without being interrupted by a call?

54
a.  = 48 (5/60) = 4
3 -4
4 e (64) (.0183)
f (3) = = = .1952
3! 6
b.  = 48 (15 / 60) = 12
10 -12
f (10) = 12 e = .1048
10 !
c.  = 48 (5 / 60) = 4 I expect 4 callers to be waiting after 5 minutes.

0 -4
f (0) = 4 e = .0183
0!
The probability none will be waiting after 5 minutes is .0183.
d.  = 48 (3 / 60) = 2.4
0 -2.4
2.4 e
f (0) = = .0907
0!
The probability of no interruptions in 3 minutes is .0907.

55

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Chapter 5

Discrete Probability Distributions

 Poisson Probability Distribution .30

© 2008 Thomson South-Western. All Rights Reserved Slide

© 2008 Thomson South-Western. All Rights Reserved Slide

 Discrete random variable with a finite number

© 2008 Thomson South-Western. All Rights Reserved Slide

 Discrete random variable with an infinite sequence

We can count the customers arriving, but there is no

© 2008 Thomson South-Western. All Rights Reserved Slide

Question Random Variable x Type

Distance from x = Distance in miles from Continuous

© 2008 Thomson South-Western. All Rights Reserved Slide

We can describe a discrete probability distribution

© 2008 Thomson South-Western. All Rights Reserved Slide

 Subjective method leads to different prob.

© 2008 Thomson South-Western. All Rights Reserved Slide

 The use of the relative frequency method to develop

© 2008 Thomson South-Western. All Rights Reserved Slide

The required conditions for a discrete probability

© 2008 Thomson South-Western. All Rights Reserved Slide

 Using past data on TV sales, …

Empirical discrete probability distribution

 Graphical Representation of Probability Distribution

© 2008 Thomson South-Western. All Rights Reserved Slide

f(x) = 1/n the values of the

© 2008 Thomson South-Western. All Rights Reserved Slide

 Variance and Standard Deviation

x x- (x - )2 f(x) (x - )2f(x)

 Four Properties of a Binomial Experiment

2. Two outcomes, success and failure, are possible

3. The probability of a success, denoted by p, does

Bernoulli process (2,3,4) and Binomial Experiment (1,2,3,4)

Our interest is in the number of successes

We let x denote the number of successes

© 2008 Thomson South-Western. All Rights Reserved Slide

 Let us consider the purchase decisions of the next

 On the basis of past experience, the store manager

© 2008 Thomson South-Western. All Rights Reserved Slide

 1. The experiment can be described as a sequence of

© 2008 Thomson South-Western. All Rights Reserved Slide

 Binomial Probability Function

© 2008 Thomson South-Western. All Rights Reserved Slide

 Binomial Probability Function

© 2008 Thomson South-Western. All Rights Reserved Slide

 Example: Evans Electronics

© 2008 Thomson South-Western. All Rights Reserved Slide

 Using the Binomial Probability Function

© 2008 Thomson South-Western. All Rights Reserved Slide

© 2008 Thomson South-Western. All Rights Reserved Slide

 Using Tables of Binomial Probabilities

© 2008 Thomson South-Western. All Rights Reserved Slide

© 2008 Thomson South-Western. All Rights Reserved Slide

E(x) =  = 3(.1) = .3 employees out of 3

Var(x) =  2 = 3(.1)(.9) = .27

  3(.1)(.9)  .52 employees

© 2008 Thomson South-Western. All Rights Reserved Slide

© 2008 Thomson South-Western. All Rights Reserved Slide

Examples of a Poisson distributed random variable:

© 2008 Thomson South-Western. All Rights Reserved Slide

 Two Properties of a Poisson Experiment

© 2008 Thomson South-Western. All Rights Reserved Slide

 Poisson Probability Function

© 2008 Thomson South-Western. All Rights Reserved Slide