Chapter 6
Continuous Random Variables
and Probability Distributions
Statistics for Business and Economics, 6e 2007 Pearson Education, Inc.
Chap 6-1
Chapter Goals
After completing this chapter, you should be
able to:
Chapter Goals
(continued)
Probability Distributions
Probability
Distributions
Ch. 5
Discrete
Probability
Distributions
Continuous
Probability
Distributions
Binomial
Uniform
Hypergeometric
Normal
Poisson
Exponential
Ch. 6
thickness of an item
time required to complete a task
temperature of a solution
height, in inches
F(x) P(X x)
3.
4.
f(x 0 ) f(x)dx
xm
Probability as an Area
Shaded area under the curve is the
probability that X is between a and b
f(x)
P (a x b)
= P (a < x < b)
(Note that the probability
of any individual value is
zero)
f(x)
xmin
xmax x
f(x) =
1
if a x b
ba
0
otherwise
where
f(x) = value of the density function at any x value
a = minimum value of x
b = maximum value of x
Properties of the
Uniform Distribution
ab
The variance is
2
(b
a)
2
12
.25
(b - a)2 (6 - 2)2
1.333
12
12
2
ab 26
4
2
2
X E(X)
2X E[(X X )2 ]
W E(a bX) a bX
the variance is
2
W
Var(a bX) b
2
W b X
2
X
X X
Z
X
Bell Shaped
Symmetrical
Mean, Median and Mode
are Equal
f(x)
Mean
= Median
= Mode
Changing increases
or decreases the
spread.
X ~ N(, 2 )
1
(x )2 /2 2
f(x)
e
2
Where
F(x 0 ) P(X x 0 )
f(x)
P(X x 0 )
x0
F(b) P(X b)
a
F(a) P(X a)
Z ~ N(0 ,1)
1
0
X
Z
Example
X 200 100
Z
2.0
50
100
0
200
2.0
X
Z
( = 100, = 50)
( = 0, = 1)
b
a
F
F
f(x)
a
a
Probability as
Area Under the Curve
The total area under the curve is 1.0, and the curve is
symmetric, so half is above the mean, half is below
f(X) P( X ) 0.5
0.5
P( X ) 0.5
0.5
P( X ) 1.0
Appendix Table 1
F(a) P(Z a)
.9772
Example:
P(Z < 2.00) = .9772
0
2.00
.0228
Example:
P(Z < -2.00) = 1 0.9772
= 0.0228
2.00
.9772
.0228
-2.00
8.0
8.6
X 8.6 8.0
0.12
5.0
=8
= 10
8 8.6
=0
=1
0 0.12
F(z)
.10
.5398
.11
.5438
.12
.5478
.13
.5517
0.00
0.12
8.0
8.6
1.000
0
0.12
1.0 - 0.5478
= 0.4522
0
0.12
X Z
(continued)
Example:
Suppose X is normal with mean 8.0 and
standard deviation 5.0.
Now find the X value so that only 20% of all
values are below this X
.2000
?
?
8.0
0
X
Z
F(z)
.82
.7939
.83
.7967
.84
.7995
.85
.8023
.20
?
8.0
-0.84 0
X
Z
X Z
8.0 ( 0.84)5.0
3.80
So 20% of the values from a distribution
with mean 8.0 and standard deviation
5.0 are less than 3.80
Assessing Normality
0
Data
Left-Skewed
Right-Skewed
100
Percent
Percent
100
0
Data
0
Data
Uniform
Nonlinear plots indicate
a deviation from
normality
Percent
100
0
Data
n independent trials
probability of success on any given trial = P
Random variable X:
E(X) nP
Var(X) nP(1- P)
2
X E(X)
X np
Z
Var(X)
nP(1 P)
If nP(1 - P) > 9,
P(a X b) P
a nP
b nP
Z
nP(1 P)
nP(1 P)
E(X) = = nP = 200(0.40) = 80
Var(X) = 2 = nP(1 P) = 200(0.40)(1 0.40) = 48
( note: nP(1 P) = 48 > 9 )
76 80
80 80
P(76 X 80) P
Z
200(0.4)(1 0.4)
200(0.4)(1 0.4)
P( 0.58 Z 0)
F(0) F( 0.58)
0.5000 0.2810 0.2190
Examples:
f(t) e
for t 0
Where
F(t) 1 e
where
Exponential Distribution
Example
Example: Customers arrive at the service counter at
the rate of 15 per hour. What is the probability that the
arrival time between consecutive customers is less
than three minutes?
F(x1, x 2 , , x k ) P(X1 x1 X 2 x 2 Xk x k )
Covariance
Cov(X, Y) E(XY) xy
Correlation
Cov(X, Y)
Corr(X, Y)
X Y
E(X1 X 2 Xk ) 1 2 k
Var(X 1 X 2 Xk ) 12 22 k2
Var(X 1 X 2 Xk ) 12 22 k2 2 Cov(Xi , X j )
i1 j i1
E(X Y) X Y
Var(X Y) 2X 2Y
Var(X Y) 2X 2Y 2Cov(X, Y)
Linear Combinations of
Random Variables
W aX bY
The mean of W is
Linear Combinations of
Random Variables
(continued)
The variance of W is
2W a 2 2X b 2 2Y 2abCov(X, Y)
2W a 2 2X b 2 2Y 2abCorr(X, Y) X Y
Example
Example
(continued)
What are the mean and standard deviation for the time to complete
both tasks?
W XY
W X Y 20 30 50
W 89 9.434
Chapter Summary