Random Variable a variable whose value is a numerical outcome of a random phenomenon.

Transcription

1 Random Variables - Terms and Formulas Random Variable a variable whose value is a numerical outcome of a random phenomenon. Example 1: Put all the letters of the alphabet in a hat. If you choose a consonant, I pay you $1. If you choose a vowel, I pay you $5. X is the random variable representing the outcome of the experiment. Its possible values are 1 and 5. Example 2: In most college courses, you get as a grade, either an A, B, C, D, or F. For credit purposes, A s are given 4 points, B s are given 3 points, C s are given 2 points, Ds are given 1 point, and F s are no points. Let X be the random variable representing the points a student gets. The possible values of X are 4, 3, 2, 1, and 0. Discrete Random Variables have a countable number of possible values. The probability distribution of X lists all possible values of X and their probabilities: Value of X x 1 x 2 x 3 x n Probability of X p 1 p 2 p 3 p n The probabilities must satisfy two requirements: Every probability p i is a number between 0 and 1. p 1 + p 2 + p p n =1 Example 3: Put all the letters of the alphabet in a hat. If you choose a consonant, I pay you $1. If you choose a vowel, I pay you $5. X is the random variable representing the outcome of the experiment. Create the distribution of X. Example 4: A college instructor teaching a large class traditionally gives 10% A s, 20% B s, 45% C s, 15% D s, and 10% F s. If a student is chosen at random from the class, the student s grade on a 4-point scale (A = 4) is a random variable X. Create the distribution of X. What is the probability that a student has a grade point of 3 or better in this class? What is the probability that a student has a grade point of 2 or worse in this class? Draw a probability histogram to picture the probability distribution of the random variable X Stu Schwartz

2 Continuous Random Variables take on all possible values in an interval of numbers. The probability distribution of X is described by a density curve. The probability of any event is the area under the density curve and above the values of X that makes up that area. Example 5: A random number is chosen from 0 to 1. Answer the following questions: a. Find P(X >.5) b. Find P(X.5) c. Find P(X.8) d. Find P(X.15) e. Find P(.2 <X <.4) f. Find P(.2 <X.4) g. Find P(X < 1) h. Find P(X =.5) Mean of a Random Variable if an experiment with random variable X is done over a long period of time, we can calculate the mean (average) value of that random variable. Another term for mean of a random variable X is the expected value of X. If X is a discrete random variable whose distribution is given by Value of X x 1 x 2 x 3 x n Probability of X p 1 p 2 p 3 p n To find the mean (or expected value) of X, multiply every possible value of X by its probability Then add the results. The symbol for the mean of X is. = x 1 p 1 + x 2 p 2 + x 3 p x n p n = " x i p i Example 6: A fair coin is flipped 3 times. Find the mean of the discrete random variable X that counts the number of heads. Example 7: The daily lottery costs $1 to play. You pick a 3 digit number. If you win, you win $500. Find the expected value of the lottery Stu Schwartz

3 Law of Large Numbers: Draw independent observations from any population with finite mean µ. As the number of observations increases, the mean x of the observed values eventually approaches the mean µ of that population. Example 8: If I flip a fair coin, over a long period of time, the percentage of heads will approach 50%. That does not mean that the number of heads will approach the number of tails. Here is a typical experiment in tossing coins. Heads ,875 49,660 Tails ,125 50,340 Percentage of heads 70% 42% 46.3% 48.75% 49.66% Example 9: If you play blackjack perfectly at a casino, the expected value for every dollar played is 98.5 cents. That means on the average of hand you play, you lose 1.5 cents. Can an individual player win playing blackjack at a casino. The law of small numbers says that over a short run, a player can certainly win. But over the long run, the law of large numbers says that a player will eventually lose. And given the huge number of players who play daily, the law of large numbers states that the casino has to win. There is a reason that casinos look the way they do it is guaranteed money. Still, players can win over the short haul. The question that crops up is what is considered large? There is no answer to that. What you have to know is that the larger n (the number of trials) gets, the closer the average win (or loss) per play approaches the true average of losing 1.5 cents a play. Rules for Means Rule 1: If X and Y are random variables, then +Y = + µ Y Rule 2: If X is a random variable and a and b are constants, thenµ a +bx = a + b Example 10: You play two casino games. Game 1 has an expectation of losing $1 a play and game 2 has an expectation of losing $2 a play. If you play both games, what is your expectation for both games. Example 11: You go to a casino and play the same slot machine which averages losing 15 cents a play. You play the machine 100 times and then leave, paying $5 for parking. Find your expectation for your casino visit. Example 12: Depending on the attendance of a minor league baseball team, the number of hot dogs and sodas sold at a game is given by the following table. Hot dogs sold ,000 2,500 Sodas sold ,500 Probability Probability If the profit on a hot dog is $1.50 and the profit on a soda is $0.75, find the average profit on hot dogs and sodas per game Stu Schwartz

4 Variance and standard deviation of a Discrete Random Variable If X is a discrete random variable whose distribution is given by Value of X x 1 x 2 x 3 x n Probability of X p 1 p 2 p 3 p n We know that the mean (expected value) of X ( ) is given by = x 1 p 1 + x 2 p 2 + x 3 p x n p n = " x i p i To find the variance of X (" 2 X ), we employ this formula: " 2 X = ( x 1 # ) 2 p 1 + ( x 2 # ) 2 p 2 + ( x 3 # ) 2 p ( x n # ) 2 p n To find the standard deviation of X (" X ), we know that ( ) = " 2 X " X Example 13: A fair coin is flipped 3 times. Find the standard deviation of the discrete random variable X that counts the number of heads. Example 14: The daily lottery costs $1 to play. You pick a 3 digit number. If you win, you win $500. Find the standard deviation of the lottery. Example 15: Choose an American household at random and let the random variable X be the number of persons living in the household. Find the standard deviation of the average American household. X or more Probability When a problem has many values of X like this one, this can be done using your list feature of your calculator: 1. Input the data into Lists L1 and L Stu Schwartz

5 2. To get, use L3 to multiply L1 and L2. 3. To find, find the sum of L3. 4. We no longer need L3. In L3, we will put our formula for variance: 5. To find the variance " 2 X, find the sum of L3. The standard deviation is the square root. Rules for Variances of Random Variables: Rule 1: If X is a random variable and a and b are constants, then Variance Standard Deviation " 2 a +bx = b 2 " 2 X " a +bx = b" X Rule 2: If X and Y are independent random variables, then Variance Standard Deviation " 2 X +Y = " 2 X + " 2 Y " X +Y = " 2 X + " 2 Y (Note that you don t add standard deviations) " 2 X #Y = " 2 X + " 2 Y " X #Y = " 2 X + " 2 Y (Note that even though you are finding the variance of the difference between X and Y, you add the variances). Example 16: Suppose two pro bowlers Adam (A) and Bart (B) have the following distribution of scores. µ A = 209 " A =14 µ B = 221 " A = 22 Find the following. a) µ B +A b) µ B"A c) 3" A d) " B +A e) " B#A Example 17: Depending on the attendance of a minor league baseball team, the number of hot dogs and sodas sold at a game is given by the following table. Hot dogs sold ,000 2,500 Sodas sold ,500 Probability Probability Find the standard deviation of the number of hot dogs plus the number of sodas sold Stu Schwartz

6 Discrete Random Variables 1. Choose an American household at random and let the random variable X be the number of persons living in the household. The probability of X is: X or more Probability a. Find P(X > 4) b. Find P(X 4) c. Find P(2 <X 4) d. Find P(X 2) 2. A fair coin is flipped 4 times. Find the probability distribution of the discrete random variable X that counts the number of heads. Then draw the probability histogram for X. a. Find P(X > 2) b. Find P(X 2) c. Find P(X 1) d. Find P(X 0) 3. A coin that is rigged is flipped 3 times. The probability of heads is twice the probability of tails. Find the probability distribution of the discrete random variable X that counts the number of heads. Then draw the probability histogram for X. a. Find P(X > 2) b. Find P(X 2) c. Find P(X 3) d. Find P(X 2) Stu Schwartz

7 4. The numbers 1, 2, 3, 4, 5 are placed in a hat. A number is chosen at random, replaced, and another number is chosen at random. Let X be the number of odd numbers that are chosen. Find the probability distribution of the random variable X and draw a probability histogram. a. Find P(X > 1) b. Find P(X 1) c. Find P(X 1) d. Find P(X 2) 5. An SRS of 3 students are chosen to be on a committee that advises a university on its computer policies. 70% of the student population are PC users and 30% are Mac users. Let X be the number of PC users on the student committee. Find the probability distribution of the random variable X and draw a probability histogram. a. Find P(X > 2) b. Find P(X 2) c. Find P(X 1) d. Find P(X 3) Stu Schwartz

8 6. A boss of a company chooses 4 workers at random to act as advisers to him. The company is 75% white and 25% African American. Let X be the number of African-Americans on the committee. Find the probability distribution of the random variable X and draw a probability histogram. a. Find P(X > 2) b. Find P(X < 2) c. Find P(1 X 3) d. Find P(X 0) 7. A density curve is shown on the figure on the right. Find the following probabilities. a. Find P(X > 1) b. Find P(X < 1.5) c. Find P(.5 X 1.5) d. Find P(X <2) 8. Two random numbers from 0 to 1 are chosen and added. Let X be their sum. X is thus a continuous random variable between 0 and 2. The density curve is shown to the right. Find the following probabilities: a. Find P(X > 1) b. Find P(X > 1.5) c. Find P(X <.2) d. Find P(.5 X 1.5) Stu Schwartz

9 Mean of a Random Variable (Expected Value) Problems 1) Choose an American suburban household at random and let the random variable X be the number of cars that people in the house own. Find the number of cars owned by the average suburban American household. X or more Probability ) A huge cookie jar has 60% chocolate cookies and 40% vanilla cookies. Sam chooses 3 cookies blindfolded. Let X be the number of chocolate cookies he chooses. Construct the probability distribution of X and the average number of chocolate cookies he chooses. 3) A contractor is bidding on a road construction job that promises a profit of $20,000 with a probability of 7 10 and a loss, due to strikes, weather conditions, late arrival of building materials, and so on, of $40,000 with a probability of 3. What is the contractor s mean expectation? 10 4 ) Pete selects one card from a deck of 52 cards. If it is an ace, he wins $5. If it is a club, he wins only $1. However, if it is the ace of clubs, then he wins an extra $10. What is his mathematical expectation? Suppose it costs him $1 to play the game. What could he expect to win or lose per game? Suppose he plays 100 games. How much would he be expected to win or lose? Stu Schwartz

10 5) A box contains 8 green marbles, 7 yellow marbles, and 5 black marbles. One marble is to be selected from the box. You get $10 if the marble selected is black, but lose $3 if the marble is green and lose $5 if the marble is yellow. What is your mean expectation? 6) A coin is tossed three times. If heads appears on all 3 tosses, Mary will win $16. If heads appears on 2 of the tosses, she will win $2. The game costs $5 to play. What is her mean expectation? 7) A carnival has set up the following game. You are blindfolded and have to pick a coin from 9 pennies, 8 nickels, 12 dimes, 16 quarters, 11 half-dollars, and 4 dollar pieces. It costs a quarter to play the game. What could you be expected to win or lose every time you play the game? 8) A pair of dice is rolled. Depending on the sum of the dots on both dice, Jake can win or lose money as shown in the following chart. What is Jake s mean expectation? Sum of Dots Outcome 6 or 8 or 9 win $6 2 or 4 or 5 lose $4 10 win $7 3 or 12 win $5 7 or 11 lose $ Stu Schwartz

11 9) An oil company will only invest in an oil well if the can expect to make at least $1 million in profit. They find a possible area in which to drill in Canada. It will cost the company $3 million to make the attempt. If they find oil, they can expect to clear $7 million in profits. Geologists have estimated that the probability of striking oil is Should the company make the attempt and why or why not? 10) A wheel of fortune below costs $2 to play. If the spinner stops on black or blue after one spin, the prize is $5. If it stops on green, the prize is $3. If it stops on yellow, the prize is $0.50. If it stops on brown or red, there is no payoff. What is your mean expectation every time you spin the wheel. Should you play the game? Black Green Yellow Red Blue Brown 11) In a raffle costing $1 a ticket, 225 tickets are sold. First place gets $50. 2 second place tickets gets $30 and 3 third place tickets gets $20. What is the mean value of your return on a ticket? 12) An ecologist collected the data shown in the table below on the life span of a certain species of deer. Based on this sample, what is the expected lifespan of this species? Age at death (years) Number Stu Schwartz

12 13) A drug is administered to sets of three patients. Over a period of time, it is determined that the probability of 3 cures, 2 cures, 1 cure, and no cures are.70,.20,.09, and.01 respectively. What is the mean number of cures that can be expected in a group of three? 14) A man on his 64th birthday obtains a $1,000 one-year insurance policy at a cost of $50. Based on mortality tables, there is a.963 probability that the man will live for at least one more year. How much can the insurance company expect to earn on this policy? Stu Schwartz

13 Mean and Standard Deviation of a Random Variable Randy and Dan are businessmen who spend time on the road weekly (Mon-Fri). They always eat dinner out. Randy spends money for dinner according to the following probability chart. X $15 $20 $25 $30 P(X) Dan spends money for dinner according to the following probability chart. X $20 $25 $30 $35 P(X) Find the average amount of money Randy spends. 2. Find the average amount of money Dan spends. 3. Find the standard deviation of the amount of money Randy spends. 4. Find the standard deviation of the amount of money Dan spends. 5. Find the average amount of money they spend for dinner together. 6. Find the standard deviation of the total money they spend for dinner together. 7. Find the average difference in money they spend for dinner. 8. Find the standard deviation of the difference they spend for dinner. 9. If Randy eats out 4 times weekly, find the average amount of money he spends on dinner weekly as well as the standard deviation. 10. If Dan eats out 5 times weekly and on Friday treats himself to wine worth $10, what is the average amount and standard deviation that he spends on dinner weekly. 12. If Randy eats out 5 times weekly and Dan 4 times weekly(no wine), find the average amount of money they spend on dinner weekly together. How about the standard deviation? Stu Schwartz

14 9. Standard Deviation of a random variable: Go back to pages 9-12 on the mean of a random variable and use that figure to calculate the standard deviation of the random variable. Standard Deviation Rules Go back to page 13 and calculate the questions dealing with standard deviation Stu Schwartz

15 Random Variables - Terms and Formulas Random Variable a variable whose value is a numerical outcome of a random phenomenon. Example 1: Put all the letters of the alphabet in a hat. If you choose a consonant, I pay you $1. If you choose a vowel, I pay you $5. X is the random variable representing the outcome of the experiment. Its possible values are 1 and 5. Example 2: In most college courses, you get as a grade, either an A, B, C, D, or F. For credit purposes, A s are given 4 points, B s are given 3 points, C s are given 2 points, Ds are given 1 point, and F s are no points. Let X be the random variable representing the points a student gets. The possible values of X are 4, 3, 2, 1, and 0. Discrete Random Variables have a countable number of possible values. The probability distribution of X lists all possible values of X and their probabilities: Value of X x 1 x 2 x 3 x n Probability of X p 1 p 2 p 3 p n The probabilities must satisfy two requirements: Every probability p i is a number between 0 and 1. p 1 + p 2 + p p n =1 Example 3: Put all the letters of the alphabet in a hat. If you choose a consonant, I pay you $1. If you choose a vowel, I pay you $5. X is the random variable representing the outcome of the experiment. Create the distribution of X. Value of X 1 5 P(X) Example 4: A college instructor teaching a large class traditionally gives 10% A s, 20% B s, 45% C s, 15% D s, and 10% F s. If a student is chosen at random from the class, the student s grade on a 4-point scale (A = 4) is a random variable X. Create the distribution of X. Value of X P(X) What is the probability that a student has a grade point of 3 or better in this class?.3 What is the probability that a student has a grade point of 2 or worse in this class?.7 Draw a probability histogram to picture the probability distribution of the random variable X. Collection 1 50% 40% 30% 20% 10% Histogram grades Stu Schwartz

16 Continuous Random Variables take on all possible values in an interval of numbers. The probability distribution of X is described by a density curve. The probability of any event is the area under the density curve and above the values of X that makes up that area. Example 5: A random number is chosen from 0 to 1. Answer the following questions: a. Find P(X >.5) b. Find P(X.5) c. Find P(X.8) d. Find P(X.15) e. Find P(.2 <X <.4) f. Find P(.2 <X.4) g. Find P(X < 1) h. Find P(X =.5) Mean of a Random Variable if an experiment with random variable X is done over a long period of time, we can calculate the mean (average) value of that random variable. Another term for mean of a random variable X is the expected value of X. If X is a discrete random variable whose distribution is given by Value of X x 1 x 2 x 3 x n Probability of X p 1 p 2 p 3 p n To find the mean (or expected value) of X, multiply every possible value of X by its probability Then add the results. The symbol for the mean of X is. = x 1 p 1 + x 2 p 2 + x 3 p x n p n = " x i p i Example 6: A fair coin is flipped 3 times. Find the mean of the discrete random variable X that counts the number of heads. X P(X) " = 3$ 1% # 8& ' + 2 " $ 3% # 8 & ' +1 " $ 3% # 8 & ' + 0 " $ 1% # 8 ' =1.5 & Example 7: The daily lottery costs $1 to play. You pick a 3 digit number. If you win, you win $500. Find the expected value of the lottery. X P(X) " 1 % " = 500$ ' % $ ' =.50 (1 = (.50 (You have to subtract the $1 cost) # 1000& # 1000& Stu Schwartz

17 Law of Large Numbers: Draw independent observations from any population with finite mean µ. As the number of observations increases, the mean x of the observed values eventually approaches the mean µ of that population. Example 8: If I flip a fair coin, over a long period of time, the percentage of heads will approach 50%. That does not mean that the number of heads will approach the number of tails. Here is a typical experiment in tossing coins. Heads ,875 49,660 Tails ,125 50,340 Percentage of heads 70% 42% 46.3% 48.75% 49.66% Example 9: If you play blackjack perfectly at a casino, the expected value for every dollar played is 98.5 cents. That means on the average of hand you play, you lose 1.5 cents. Can an individual player win playing blackjack at a casino. The law of small numbers says that over a short run, a player can certainly win. But over the long run, the law of large numbers says that a player will eventually lose. And given the huge number of players who play daily, the law of large numbers states that the casino has to win. There is a reason that casinos look the way they do it is guaranteed money. Still, players can win over the short haul. The question that crops up is what is considered large? There is no answer to that. What you have to know is that the larger n (the number of trials) gets, the closer the average win (or loss) per play approaches the true average of losing 1.5 cents a play. Rules for Means Rule 1: If X and Y are random variables, then +Y = + µ Y Rule 2: If X is a random variable and a and b are constants, thenµ a +bx = a + b Example 10: You play two casino games. Game 1 has an expectation of losing $1 a play and game 2 has an expectation of losing $2 a play. If you play both games, what is your expectation for both games. +Y = "1" 2 = "3 Example 11: You go to a casino and play the same slot machine which averages losing 15 cents a play. You play the machine 100 times and then leave, paying $5 for parking. Find your expectation for your casino visit. µ 100X "5 =100 (".15) " 5 = "$20 Example 12: Depending on the attendance of a minor league baseball team, the number of hot dogs and sodas sold at a game is given by the following table. Hot dogs sold ,000 2,500 Sodas sold ,500 Probability Probability If the profit on a hot dog is $1.50 and the profit on a soda is $0.75, find the average profit on hot dogs and sodas per game. µ hotdogs =100 (.05) (.1) (.3) (.35) (.2) = $1,025 µ soda =100 (.1) (.15) (.25) (.3) (.2) = $680 µ hotdogs+sodas = $1, Stu Schwartz

18 Variance and standard deviation of a Discrete Random Variable If X is a discrete random variable whose distribution is given by Value of X x 1 x 2 x 3 x n Probability of X p 1 p 2 p 3 p n We know that the mean (expected value) of X ( ) is given by = x 1 p 1 + x 2 p 2 + x 3 p x n p n = " x i p i To find the variance of X (" 2 X ), we employ this formula: " 2 X = ( x 1 # ) 2 p 1 + ( x 2 # ) 2 p 2 + ( x 3 # ) 2 p ( x n # ) 2 p n To find the standard deviation of X (" X ), we know that ( ) = " 2 X " X Example 13: A fair coin is flipped 3 times. Find the standard deviation of the discrete random variable X that counts the number of heads. $ " 2 X = 3#1.5 & ' $ ) + 2 #1.5 & ' $ ) + 1#1.5 & ' $ ) + 0 #1.5 & ' ) =.75 " % ( % ( % ( % ( X =.866 ( ) ( ) ( ) ( ) Example 14: The daily lottery costs $1 to play. You pick a 3 digit number. If you win, you win $500. Find the standard deviation of the lottery. ( ) 2 & 1 " 2 X = 500 #.5 $ ' ) + 0 #.5 % 1000( ( ) 2 & 999 $ ' ) = " % 1000( X = Example 15: Choose an American household at random and let the random variable X be the number of persons living in the household. Find the standard deviation of the average American household. X or more Probability =.25( 1) +.32( 2) +.17( 3) +.15( 4) +.07( 5) +.03( 6) +.01( 7) = 2.6 " 2 X =.25( 1# 2.6) ( 2 # 2.6) ( 3 # 2.6) ( 4 # 2.6) ( 5 # 2.6) ( 6 # 2.6) ( 7 # 2.6) 2 = 2.02 " X =1.421 When a problem has many values of X like this one, this can be done using your list feature of your calculator: 1. Input the data into Lists L1 and L Stu Schwartz

19 2. To get, use L3 to multiply L1 and L2. 3. To find, find the sum of L3. 4. We no longer need L3. In L3, we will put our formula for variance: 5. To find the variance " 2 X, find the sum of L3. The standard deviation is the square root. Rules for Variances of Random Variables: Rule 1: If X is a random variable and a and b are constants, then Variance Standard Deviation " 2 a +bx = b 2 " 2 X " a +bx = b" X Rule 2: If X and Y are independent random variables, then Variance Standard Deviation " 2 X +Y = " 2 X + " 2 Y " X +Y = " 2 X + " 2 Y (Note that you don t add standard deviations) " 2 X #Y = " 2 X + " 2 Y " X #Y = " 2 X + " 2 Y (Note that even though you are finding the variance of the difference between X and Y, you add the variances). Example 16: Suppose two pro bowlers Adam (A) and Bart (B) have the following distribution of scores. µ A = 209 " A =14 µ B = 221 " A = 22 Find the following. a) µ B +A b) µ B"A c) 3" A d) " B +A e) " B#A = " 209 =12 3( 209) = Example 17: Depending on the attendance of a minor league baseball team, the number of hot dogs and sodas sold at a game is given by the following table. Hot dogs sold ,000 2,500 Sodas sold ,500 Probability Probability Find the standard deviation of the number of hot dogs plus the number of sodas sold. " 2 hotdogs = " 2 sodas = " hotdogs + sodas = = Stu Schwartz

20 Discrete Random Variables 1. Choose an American household at random and let the random variable X be the number of persons living in the household. The probability of X is: X or more Probability a. Find P(X > 4) b. Find P(X 4) c. Find P(2 <X 4) d. Find P(X 2) A fair coin is flipped 4 times. Find the probability distribution of the discrete random variable X that counts the number of heads. Then draw the probability histogram for X. X Probability Collection 1 40% Histogram 30% 20% 10% Heads a. Find P(X > 2) b. Find P(X 2) c. Find P(X 1) d. Find P(X 0) A coin that is rigged is flipped 3 times. The probability of heads is twice the probability of tails. Find the probability distribution of the discrete random variable X that counts the number of heads. Then draw the probability histogram for X. X Probability Collection 1 60% 50% 40% 30% 20% 10% Histogram Heads a. Find P(X > 2) b. Find P(X 2) c. Find P(X 3) d. Find P(X 2) Stu Schwartz

21 4. The numbers 1, 2, 3, 4, 5 are placed in a hat. A number is chosen at random, replaced, and another number is chosen at random. Let X be the number of odd numbers that are chosen. Find the probability distribution of the random variable X and draw a probability histogram. X Probability Collection 1 60% 50% 40% 30% 20% 10% Histogram Heads a. Find P(X > 1) b. Find P(X 1) c. Find P(X 1) d. Find P(X 2) An SRS of 3 students are chosen to be on a committee that advises a university on its computer policies. 70% of the student population are PC users and 30% are Mac users. Let X be the number of PC users on the student committee. Find the probability distribution of the random variable X and draw a probability histogram. X Probability Collection 1 60% 50% 40% 30% 20% 10% Histogram PC a. Find P(X > 2) b. Find P(X 2) c. Find P(X 1) d. Find P(X 3) Stu Schwartz

22 6. A boss of a company chooses 4 workers at random to act as advisers to him. The company is 75% white and 25% African American. Let X be the number of African-Americans on the committee. Find the probability distribution of the random variable X and draw a probability histogram. X Probability Collection 1 40% 30% 20% 10% Histogram PC a. Find P(X > 2) b. Find P(X < 2) c. Find P(1 X 3) d. Find P(X 0) A density curve is shown on the figure on the right. Find the following probabilities. a. Find P(X > 1) b. Find P(X < 1.5) c. Find P(.5 X 1.5) d. Find P(X <2) Two random numbers from 0 to 1 are chosen and added. Let X be their sum. X is thus a continuous random variable between 0 and 2. The density curve is shown to the right. Find the following probabilities: a. Find P(X > 1) b. Find P(X > 1.5) c. Find P(X <.2) d. Find P(.5 X 1.5) Stu Schwartz

23 Mean of a Random Variable (Expected Value) Problems 1) Choose an American suburban household at random and let the random variable X be the number of cars that people in the house own. Find the number of cars owned by the average suburban American household. X or more Probability = # X " P( X) = 2.08 $ = P( X) ( X % ) 2 = ) A huge cookie jar has 60% chocolate cookies and 40% vanilla cookies. Sam chooses 3 cookies blindfolded. Let X be the number of chocolate cookies he chooses. Construct the probability distribution of X and the average number of chocolate cookies he chooses. X Probability = # X " P( X) =1.80 $ = P( X) ( X % ) 2 = ) A contractor is bidding on a road construction job that promises a profit of $20,000 with a probability of 7 10 and a loss, due to strikes, weather conditions, late arrival of building materials, and so on, of $40,000 with a probability of 3. What is the contractor s mean expectation? 10 X Probability.7.3 = # X " P( X) = $2,000 $ = P( X) ( X % ) 2 = $27,495 4 ) Pete selects one card from a deck of 52 cards. If it is an ace, he wins $5. If it is a club, he wins only $1. However, if it is the ace of clubs, then he wins an extra $10. What is his mathematical expectation? Suppose it costs him $1 to play the game. What could he expect to win or lose per game. Suppose he plays 100 games. How much would he be expected to win or lose? X Probability = # X " P( X) =.827 $1 = $.173 % = P( X) ( X $ ) 2 = $ games - loss of $ Stu Schwartz

24 5) A box contains 8 green marbles, 7 yellow marbles, and 5 black marbles. One marble is to be selected from the box. You get $10 if the marble selected is black, but lose $3 if the marble is green and lose $5 if the marble is yellow. What is your mean expectation? X Probability = # X " P( X) = $.45 % = P( X) ( X $ ) 2 = ) A coin is tossed three times. If heads appears on all 3 tosses, Mary will win $16. If heads appears on 2 of the tosses, she will win $2. The game costs $5 to play. What is her mean expectation? X Probability = # X " P( X) = 2.75 $ 5 = $2.25 % = P( X) ( X $ ) 2 = ) A carnival has set up the following game. You are blindfolded and have to pick a coin from 9 pennies, 8 nickels, 12 dimes, 16 quarters, 11 half-dollars, and 4 dollar pieces. It costs a quarter to play the game. What could you be expected to win or lose every time you play the game? X Probability = # X " P( X) =.253$.25 =.003 % = P( X) ( X $ ) 2 =.260 8) A pair of dice is rolled. Depending on the sum of the dots on both dice, Jake can win or lose money as shown in the following chart. What is Jake s mean expectation? Sum of Dots Outcome 6 or 8 or 9 win $6 2 or 4 or 5 lose $4 10 win $7 3 or 12 win $5 7 or 11 lose $1 X Probability = # X " P( X) = $ = P( X) ( X % ) 2 = Stu Schwartz

25 9) An oil company will only invest in an oil well if the can expect to make at least $1 million in profit. They find a possible area in which to drill in Canada. It will cost the company $3 million to make the attempt. If they find oil, they can expect to clear $7 million in profits. Geologists have estimated that the probability of striking oil is Should the company make the attempt and why or why not? X 7 0 Probability = # X " P( X) = 2.45 $ 3 = $$550,000 (no - don't drill) % = P( X) ( X $ ) 2 = million 10) A wheel of fortune below costs $2 to play. If the spinner stops on black or blue after one spin, the prize is $5. If it stops on green, the prize is $3. If it stops on yellow, the prize is $0.50. If it stops on brown or red, there is no payoff. What is your mean expectation every time you spin the wheel? Should you play the game? X Probability Black Green Yellow Red Blue Brown = # X " P( X) = 2.25 $ 2 =.25 (play the game) % = P( X) ( X $ ) 2 = ) In a raffle costing $1 a ticket, 225 tickets are sold. First place gets $50. 2 second place tickets gets $30 and 3 third place tickets gets $20. What is the mean value of your return on a ticket? X Probability = # X " P( X) =.75 $1 = $.25 % = P( X) ( X $ ) 2 = ) An ecologist collected the data shown in the table below on the life span of a certain species of deer. Based on this sample, what is the expected lifespan of this species? Age at death (years) Number = # X " P( X) = $ = P( X) ( X % ) 2 = Stu Schwartz

26 13) A drug is administered to sets of three patients. Over a period of time, it is determined that the probability of 3 cures, 2 cures, 1 cure, and no cures are.70,.20,.09, and.01 respectively. What is the mean number of cures that can be expected in a group of three? X Probability = # X " P( X) = $ = P( X) ( X % ) 2 = ) A man on his 64th birthday obtains a $10,000 one-year insurance policy at a cost of $500. Based on mortality tables, there is a.963 probability that the man will live for at least one more year. How much can the insurance company expect to earn on this policy? X Probability = # X " P( X) = 370 $ 500 = $$130 Insurance company makes $130 % = P( X) ( X $ ) 2 = Stu Schwartz

27 Mean and Standard Deviation of a Random Variable Randy and Dan are businessmen who spend time on the road weekly (Mon-Fri). They always eat dinner out. Randy spends money for dinner according to the following probability chart. X $15 $20 $25 $30 P(X) Dan spends money for dinner according to the following probability chart. X $20 $25 $30 $35 P(X) Find the average amount of money Randy spends..2( 15) +.4( 20) +.25( 25) +.15( 30) = $ Find the average amount of money Dan spends..35( 20) +.25( 25) +.3( 30) +.1( 35) = $ Find the standard deviation of the amount of money Randy spends. " 2 = ( ) +.4( 20 # 21.75) +.25( 25 # 21.75) +.15( 30 # 21.75) = " = $ Find the standard deviation of the amount of money Dan spends. " 2 = ( ) +.25( 25 # 25.75) +.3( 30 # 25.75) +.1( 35 # 25.75) = " = $ Find the average amount of money they spend for dinner together = $ Find the standard deviation of the total money they spend for dinner together = $ Find the average difference in money they spend for dinner " = $ Find the standard deviation of the difference they spend for dinner = $ If Randy eats out 4 times weekly, find the average amount of money he spends on dinner weekly as well as the standard deviation. µ 4x = ( ) = $87.00 " 4 x = 4( 4.82) = $ If Dan eats out 5 times weekly and on Friday treats himself to wine worth $10, what is the average amount and standard deviation that he spends on dinner weekly. µ 10+5x = ( ) = $ " 10+5x = 5( 5.07) = $ If Randy eats out 5 times weekly and Dan 4 times weekly(no wine), find the average amount of money they spend on dinner weekly together. How about the standard deviation? µ 5x +4 y = 5( 21.75) + 4( 25.75) = $ " 5x +4y = 25( 4.82) 2 +16( 5.07) 2 = $ Stu Schwartz

28 Standard Deviation of a random variable: Go back to pages 9 12 on the mean of a random variable and use that figure to calculate the standard deviation of the random variable. Standard Deviation Rules Go back to page 13 and calculate the questions dealing with standard deviation Stu Schwartz