Probability eory

Random Experiment
An experiment that can result in different outcomes, even though it is
repeated in the same manner every time, is called a random experiment.

Sample Space
The set of all possible outcomes of a random experiment is called the
sample space of the experiment. The sample space is denoted as .

Discrete Continuous
A sample space is discrete if it A sample space is continuous if it
consists of a finite or countable contains an interval (either finite
infinite set of outcomes. or infinite) of real numbers.

Event
An event is a subset of the sample space of a random experiment.

❋ We can use basic set operations to form other events of interest.

Union Intersection Complement

The union of two The intersection of The complement of an
events is the event two events is the event in a sample
that consists of all event that consists of space is the set of
outcomes that are all outcomes that are outcomes in the
contained in either of contained in both of sample space that are
the two events. the two events. not in the event.

or
Mutually Exclusive Events
Two events, denoted as and , such that

are said to be mutually exclusive or disjoint.

DeMorgan’s laws

❋ Counts of the numbers of outcomes in sample spaces and various events used
to analyze random experiments are referred to as counting techniques.

Fundamental Counting Principle

Assume an operation can be described as a sequence of steps, and
• the number of ways of completing step is , and
• the number of ways of completing step is for each way of
completing step , and
• the number of ways of completing step is for each way of
completing step , and so forth.
The total number of ways of completing the operation is

Permutations
The number of permutations, ordered sequences, of different
elements is where

The number of permutations of subsets of elements selected from a

set of different elements is

Permutations of Similar Objects

The number of permutations of objects of which
are of one type, are of a second type,…, and are of an rth type is
Combinations
The number of combinations, subsets of elements that can be selected
from a set of elements, is denoted as or and

Probability
Probability is used to quantify the likelihood, or chance, that an outcome
of a random experiment will occur.
• The probability of an outcome can be interpreted as our subjective
probability, or degree of belief, that the outcome will occur.
• Another interpretation of probability is based on the conceptual
model of repeated replications of a random experiment or the
long-run relative frequency of occurrence.

Equally Likely Outcomes

Whenever a sample space consists of possible outcomes that are
equally likely, the probability of each outcome is .

Probability of an Event
For a discrete sample space, the probability of an event , denoted as
, equals the sum of the probabilities of the outcomes in .

Axioms of Probability
Probability is a number assigned to each member of a collection of
events from a random experiment that satisfies the following:
If is the sample space and is any event in a random experiment,

(1)

(2)

(3) For two mutually exclusive events

Probability of a Union
The probability of event or is interpreted as and the
following general addition rule applies.

Conditional Probability
The probability of an event under the knowledge that the outcome will
be in event is denoted as and this is called the conditional
probability of given .

for

Multiplication Rule

Total Probability Rule

Independence
Two events are independent if any one of the following equivalent
statements is true:

(1)

(2)

(3)

Bayes’ Theorem
for
Random Variable
A random variable, denoted by an uppercase letter, is a function that
assigns a real number to each oucome in a sample space of a random
experiment. Its measured values are denoted by lowercase letters.

Discrete Continuous
A discrete random variable is a The range of a continuous random
random variable with a finite (or variable is an interval (either
countably infinite) range finite or infinite) of the reals.

Probability Mass Function

For a discrete random variable with possible values , a
probability mass function is a function such that

(1) (2)

(3)

Cumulative Distribution Function

The cumulative distribution function of a discrete random variable
is a is a function such that

(1)

(2)

(3) If , then

Mean, Variance, and Standard Deviation

The mean or expected value, variance, and standard deviation of the
discrete random variable are defined respectively as
Bernoulli trial
A random experiment with two possible outcomes, success or failure.

Binomial Distribution
A random experiment consists of Bernoulli trials such that
(1) The trials are independent.
(2) Each trial results in only two possible outcomes.
(3) The probability of a success in each trial remains constant.
The random variable that equals the number of trials that result in a
success is a binomial random variable with parameters and

Geometric Distribution
In a series of Bernoulli trials (independent trials with constant
probability of a success), the random variable that equals the number
of trials until the first success is a geometric random variable with
parameter and

Poisson Distribution
The random variable that equals the number of events in an interval of
length in a Poisson process, a random process that models the
occurrence of events in time or space where is the average rate of
events per unit time or space and the number of events in disjoint
intervals are independent random variables, is a Poisson random variable
with parameter , and
Probability Density Function
For a continuous random variable , a probability density function is a
function such that

(1) (2)

(3)

Cumulative Distribution Function

The cumulative distribution function of a continuous random variable is

Mean, Variance, and Standard Deviation

The mean or expected value, variance, and standard deviation of a
continuous random variable are defined respectively as

Moment-Generating Function
The rth moment about the origin of the random variable is

discrete

continuous

The moment-generating function of the random variable is the

expected value of and is denoted by . That is,
Continuous Uniform Distribution
A continuous random variable with probability density function

is a continuous uniform random variable.

Exponential Distribution
The random variable that equals the distance between successive
events from a Poisson process with mean number of events per
unit interval is an exponential random variable with parameter . The
probability density function of is

Lack of Memory Property

Normal Distribution
A random variable with probability density function

is a normal random variable with parameters and .

Also,

A standard normal random variable is defined as

The cumulative distribution function of a standard normal random

variable is a non-elementary antiderivative and is denoted as

We can standarize a normal random variable to calculate probabilities

Joint Probability Mass Function
The bivariate probability distribution of two discrete random variables
and is a function that satisfies

(1) (2)

(3)

Marginal Probability Mass Function

The marginal probability mass functions of and are defined as

Conditional Probability Mass Function

The conditional probability mass functions of and are defined as

Expected Value of a Function

Variance, Covariance, and Correlation

The variance, covariance, and correlation of two discrete bivariate
random variables X and Y are defined respectively as

Independence
Statistics
Statistics is the discipline that concerns the collection, organization,
analysis, interpretation, and presentation of data.

Descriptive Inferential
Descriptive statistics deals with Inferential statistics deals with
organizing and summarizing data drawing conclusions about
using numerical summaries populations based on samples.

Measures of Location
Sample mean
affected by extreme
values (outliers)

Sample median
odd
not affected by
extreme values even
(outliers)

Quartiles are values that separate the data into four equal parts.

Percentiles are values that separate the data into 100 equal parts.

Measures of Variability
Sample range

Sample variance
where is called
the degree of freedom

Sample standard deviation

Sample covariance

Interquartile range is the difference between the third and first quartiles.