BASIC STATISTICS

CHAPTER FOUR
4. PROBABILITY THEORY
AND PROBABILITY
DISTRIBUTION
 4.1 PROBABILITY THEORY
 Probability of an event is a number that
measures the chance, or likelihood, that the
event will occur.
 For instance, the probability that your fa-
vorite football team will win its next game
measures the likelihood of a victory.
 The probability of an event is always a
number between 0 and 1.
 The closer an event’s probability is to 1, the
higher is the likelihood that the event will
occur; the closer the event’s probability is
to 0, the smaller is the likelihood that the
 For example, if you believe that the
probability that your favorite football
team will win its next game is 0.95, then
you are almost sure that your team will
win. However, if you believe that the
probability of victory is only 0.10, then
you have very little confidence that your
team will win.
SOME BASIC CONCEPTS
 Probability, in common parlance, refers
to the chance of occurrence of an event
or happening.
 These concepts are an Experiment, a
A. EXPERIMENT
 A random experiment is a mechanism that
produces a definite outcome that cannot be
predicted with certainty.
 An outcome of an experiment is some obser-
vation or measurement.
 Any action, whether it is the drawing a card
out of a deck of 52 cards, or reading the
temperature, or measurement of a product's
dimension to ascertain quality, or the launch-
ing of a new product in the market, consti-
tute an experiment in the probability theory
terminology.
 Cont’d
The experiments in probability theory
have three things in common:
there are one or more outcomes of each
experiment
it is possible to specify the outcomes in
advance
there is uncertainty about the outcomes
A single outcome of an experiment is
called a basic outcome or an elemen-
tary event.
 Any particular card drawn from a deck
B. SAMPLE SPACE
 The Sample space is the universal
set S pertinent to a given experi-
ment.
 It is the set of all possible outcomes
of an experiment.
 So each outcome is visualized as a
sample point in the sample space.
The sample spaces for the following experiments are:
Experiment Sample Space
Drawing a Card {all 52 cards in the
deck}
Reading the Tempera- {all numbers in the
ture range of temperatures}
Measurement of a {undersize, outsize,
Product's Dimension right size}
Launching of a New {success, failure}
Product
3. EVENT
An event, in probability theory,
constitutes one or more possible
outcomes of an experiment.
An Event is a subset of a sample
space.
It is a set of basic outcomes.
We say that the event occurs if the
experiment gives rise to a basic
outcome belonging to the event.
 For the experiment of drawing a
 APPROACHES TO PROBABILITY
THEORY
 We often wish to assign probabilities to
sample space outcomes.
This is usually done by using one of
three methods:
 The classical method, the relative
frequency method, or the subjective
method.
Regardless of the method used, proba-
bilities must be assigned to the exper-
imental outcomes so that two condi-
tions are met:
1. The probability assigned to each
sample space outcome must be be-
tween 0 and 1 that is, if E repre-
sents a sample space outcome and
if P(E) represents the probability of
this outcome, then 0 ≤ P(E) ≤ 1.
2. The probabilities of all of the sam-
ple space outcomes must sum to 1.
 THE CLASSICAL APPROACH
 The classical method of assigning probabili-
ties can be used when the sample space out-
comes are equally likely.
 For example, consider the experiment of toss-
ing a fair coin. Here, there are two equally
likely sample space outcomes head (H) and
tail (T).
 Therefore, logic suggests that the probability
of observing a head, denoted P(H), is 1/2 =
0.5, and that the probability of observing a
tail, denoted P(T), is also 1/2 = 0.5.
 Notice that each probability is between 0
and 1. Furthermore, because H and T are
all of the sample space outcomes, P(H) +
P(T) = 1.
 In general, if there are N equally likely
sample space outcomes, the probability
assigned to each sample space outcome
is 1/N.
To illustrate this, consider the experiment
of rolling a fair die.
 It would seem reasonable to think that
the six sample space outcomes 1, 2, 3, 4,
5, and 6 are equally likely, and thus each
 If P(1) denotes the probability that one dot appears
on the upward face of the die, then P(1) = 1/6. Simi-
larly, P(2) = 1/6, P(3) = 1/6, P(4) = 1/6, P(5) = 1/6,
and P(6) = 1/6.
 In the Classical Approach, probability of an event is
defined as the relative size of the event with re-
spect to the size of the sample space. The rule we
use in computing probabilities, assuming equal likeli-
hood of all basic outcomes, is as follows:
Probability of the event A:
P (A) = n (A)
N (S)
Where, n (A) = the number of outcomes favorable
to the event A
N (S) = total number of outcomes
Example: 1 A fair coin is tossed
twice.
Find the probabilities of the following
events:
a)getting two heads
b)getting one head and one tail
c)getting at least one head or one
tail
d)getting four heads
THE RELATIVE FREQUENCY APPROACH
The Relative Frequency Approach is used
to compute probability in which there is
only a past data. In the absence of past
data, we have to undertake an experiment.
As per this approach, the probability of
occurrence of an event is given by the ob-
served relative frequency of an event in
a very large number of trials. In other
words, the probability of occurrence of an
event is the ratio of the number of times
the event occurs to the total number of tri-
als.
For example, to estimate the probabil-
ity that a randomly selected consumer
prefers Coca-Cola to all other soft
drinks, we perform an experiment in
which we ask a randomly selected con-
sumer for his or her preference.
There are two possible experimental
outcomes: “prefers Coca- Cola” and
“does not prefer Coca-Cola.” However,
we have no reason to believe that
these experimental outcomes are
equally likely, so we cannot use the
classical method.
 We might perform the experiment, say,
1,000 times by surveying 1,000 randomly
selected consumers. Then, if 140 of those
surveyed said that they prefer Coca-Cola,
we would estimate the probability that a
randomly selected consumer prefers Coca-
Cola to all other soft drinks to be 140/1,000
= 0.14.
 This is an example of the relative frequency
method of assigning probability. The proba-
bility of the event B:
P (B) = n
N
Where, n = the number of times the
event occurs
Example: 2
A newspaper boy wants to find out the
chances that on any day he will be able to
sell more than 90 copies of The Times of
Ethiopia. From his dairy where he
recorded the daily sales of the last year,
he finds out that out of 365 days, on 75
days he had sold 80 copies, on 144 days
he had sold 85 copies, on 62 days he had
sold 95 copies and on 84 days he had
sold 100 copies of The Times of Ethiopia.
Find out the required probability for the
newspaper boy.
THE SUBJECTIVE APPROACH
 In this approach, we try to assess the
probability from our own experiences. We
may bring in any information to assess this.
Therefore the Subjective Approach involves
personal judgment, information, intuition,
and other subjective evaluation criteria.
The area of subjective probability - which
is relatively new, having been first devel-
oped in the 1930s – is somewhat contro-
versial. One person's subjective probability
may very well be different from another
person's subjective probability of the same
 Cont’d
 We may note here that since the as-
sessment is a purely subjective one, it
will vary from person to person and,
therefore, subjective probability is also
called Personal Probability.
Example: 3
 In a certain situation, one might ex-
press the confidence that there are
70:30 chances of a salesman achieving
his sales quote.
Some Elementary Probability Rules
We can often calculate probabilities by
using formulas called probability rules.
We will begin by presenting the simplest
probability rule: the rule of comple-
ments. To start, we define the comple-
ment of an event:
 The Rule of Complements defines the
probability of the complement of an event
in terms of the probability of the original
event. Consider event A defined over the
sample space S.
 Cont’d
 The complement of an event A in a sample space
S, denoted by Ac, is the collection of all outcomes
in S that are not elements of the set A. (see Figure
1)
P (Ac) = 1 - P (A)

Figure 1 Comple-
ment of an event

 As a simple example, if the probability of rain to-

morrow is 0.3, then the probability of no rain to-
morrow must be 1 - 0.3 = 0.7. If the probability of
drawing a king is 4/52, then the probability of the
THE UNION RULE
 A very important rule in probability theory, the
Rule of Unions (also called Addition Theorem) allows
us to write the probability of the union of two events
in terms of the probabilities of the two events and the
probability of their intersection.
Consider two events A and B defined over the sam-
ple space S, as shown in the following Figure

Figure 2 Two Overlapping

Events A and B

Thus, the rule of unions is:

P (A ∪ B) = P (A) + P (B) − P (A ∩ B)
The probability of the intersection of two events P
(A ∩ B) is called their joint probability.
 Example: 4
 A card is drawn from a well-shuffled pack of playing
cards. Find the probability that the card drawn is ei-
ther a club or a king.
Mutually Exclusive Events
 Two events A and B are mutually exclusive if they
have no sample space outcomes in common. In this
case, the events A and B cannot occur simultane-
ously, and thus P(A ∩ B) = 0

Figure 3 Two Mutually Exclusive Events A and B

This fact gives us a special rule for
unions of mutually exclusive events.
Since the probability of the intersection
of the two events is zero, there is no
need to subtract P (A∩B) when the
probability of the union of the two
events is computed.
Therefore,
 For mutually exclusive events A and B:
P (A ∪ B) = P
(A) + P (B)
This is not really a new rule since we
can always use the rule of unions for the
 Cont’d
Example: 5
A card is drawn from a well-shuffled
pack of playing cards. Find the probabil-
ity that the card drawn is either a king
or a queen
We can extend the Rule of Unions to
three (or more) events. Let A, B, and C
be the three events defined over the
sample space S, as shown below.
 Then, the Rule of Unions is:
 P (A∪B∪C) = P (A) + P (B) + P (C) − P
Figure 4 Three Overlapping Events A, B and C
 When the three events are mutually exclusive (see Figure 5), the Rule of
Unions is:
P (A∪B∪C) = P (A) + P (B) + P (C)

 Figure 5 Three Mutually Exclusive Events A, B and C

 Cont’d
Example: 6
 A card is drawn from a well-shuffled pack of playing cards. Find
the probability that the card drawn is
a. either a heart or an honour or king
b. either an ace or a king or a queen.
THE CONDITIONAL PROBABILITY RULE
 As a measure of uncertainty, probability depends on information.
We often face situations where the probability of an event A is in-
fluenced by the information that another event B has occurred.
 Thus, the probability we would give the event "XYZ Company’s
stock price will go up tomorrow" depends on what we know about
the company and its performance; the probability is conditional
upon our information set.
 In this example, event A may be the event that the stock will go up
tomorrow, and event B may be a favorable quarterly report.
 Consider two events A and B defined over the sample space S, as
shown below in Figure 6

Figure 6 Conditional Probability of Event A

Conditional Probability
 The conditional probability of the event A given that the event B
has occurred is written P(A |B) and is defined to be
P(A |B) and is defined to be:
P (A / B) = P (A∩B)
P(B)
 Here we assume that P(B) is greater than 0.
 The conditional probability of the event B given that the
event A has occurred is written P(B | A) and is defined to be:
P (B / A) = P(A∩B)
P(A)
Here we assume that P(A) is greater than 0.
o The vertical line in P (A / B) is read given, or conditional
upon.
Example: 7
For an experiment of throwing a die twice, find the probabil-
ity:
a) of the event of getting a total of 9, given that the die has
shown up points between 4 and 6 (both inclusive)
b) of the event of getting points between 4 and 6 (both inclu-
sive), given that a total of 9 has already been obtained
 SOLUTION
 Total possible outcome O n = 62 = 36
(1,1) (2,1) (3,1) (4,1) (5,1) (6,1)
(1,2) (2,2) (3,2) (4,2) (5,2) (6,2)
(1,3) (2,3) (3,3) (4,3) (5,3) (6,3)
(1,4) (2,4) (3,4) (4,4) (5,4) (6,4)
(1,5) (2,5) (3,5) (4,5) (5,5) (6,5)
(1,6) (2,6) (3,6) (4,6) (5,6) (6,6)
Let A be the event of getting a total of 9
Let B be the event of getting points between 4 and 6 (both in-
clusive)
 Cont’d

n(A) = 4 ; n(B) = 9 ; n(AnB) = 2

P(A/B) = P(AnB) = 2/36 = 2/9 = 0.22
P(B) 9/36

P(B/A) = P(AnB) = 2/36 = 2/4 = 0.5

P(A) 4/36
 THE PRODUCT RULE
 The Product Rule (also called Multiplication Theorem) al-
lows us to write the probability of the simultaneous occur-
rence of two (or more) events.
o In the conditional probability rules
P (A/B) = P(A∩B) and P (B/A) = P(B∩A)
P(B) P(A)

 A ∩ B or B ∩ A is the event A and B occur simultaneously.

So rearranging the conditional probability rules, we have our
Product Rule
 P (A∩B) = P(A/B).P(B) and P(A∩B) = P(B/A).P(A)
Example: 8
A box contains 10 balls out of which 2 are green, 5 are red
and 3 are black. If two balls are drawn at random, one after
the other without replacement, from the box. Find the prob-
abilities that:
(a) both the balls are of green color
(b) both the balls are of black color
(c) both the balls are of red color
(d) the first ball is red and the second one is black
(e) the first ball is green and the second one is red
 Independent Events
 Two events are said to be independent of each other if the oc-
currence or non-occurrence of one event in any trial does not af-
fect the occurrence of the other event in any trial.
 When A and B are independent (and only when they are inde-
pendent), we can obtain the probability of the joint occurrence
of A and B (i.e. the probability of their intersection) simply by
multiplying the two separate probabilities. This rule is thus
called the Product Rule for Independent Events.
 Conditions for the independence of two events A and B:
P ( A / B ) = P ( A)
P (B / A) = P (B )
and P ( A ∩ B ) = P ( A). P (B )
 Here we assume that P(A) and P(B) are greater than 0.
 Cont’d
 The first two equations have a clear, intuitive appeal. The top
equation says that when A and B are independent of each
other, then the probability of A stays the same even when we
know that B has occurred - it is a simple way of saying that
knowledge of B tells us nothing about A when the two events
are independent. Similarly, when A and B are independent,
then knowledge that A has occurred gives us absolutely no in-
formation about B and its likelihood of occurring.
 The third equation, however, is the most useful in applications.
It tells us that when A and B are independent (and only when
they are independent), we can obtain the probability of the
joint occurrence of A and B (i.e. the probability of their inter-
section) simply by multiplying the two separate probabilities.
This rule is thus called the Product Rule for Independent
Events.
 A Counting Rule for Multiple-Step Experiments
 If an experiment can be described as a sequence of k steps in
which there are n1 possible outcomes on the first step, n2 pos-
sible outcomes on the second step, and so on, then the total
number of experimental outcomes is given by (n1)(n2) . . . (nk).
Example 9: Now suppose the student takes a class quiz consist-
ing of three true–false questions. Then, there are (n1)(n2)(n3) =
(2)(2)(2) = 8 experimental outcomes. If the student is totally
unprepared for the quiz and has to blindly guess the answer to
each question, the 8 experimental outcomes might be consid-
ered to be equally likely.
 Therefore, since only one of these outcomes corresponds to all
three questions being answered correctly, the probability that
the student will answer all three questions correctly is 1/8.
 A Counting Rule for Combinations
 The number of combinations of n items that can be selected
from N items is
nCr = n!
r!(n-r)!
where, n! = n(n-1) (n-2).....1 r! = r(r-1) (r-2)........1
Example : 10
 Among 15 clocks there are two defectives. In how many ways
can an inspector chose three of the clocks for inspection so
that:
a) There is no restriction.
b) None of the defective clock is included.
c) Only one of the defective clocks is included.
d) Two of the defective clock is included.
 BAYES’ THEOREM
 The Bayes’ theorem is useful in revising the original probabil-
ity estimates as we gain additional information about the
events or outcomes.
 Prior probability is the initial probability based on the present
level of information.
 The prior probabilities when changed in the light of new in-
formation are called revised or posterior probability.
 Posterior probability is a revised probability based on addi-
tional information.

P ( Bi /A ) = P(A/Bi).P(Bi)
∑ P(A/ Bi).P(Bi)
 Cont’d
 Suppose there are two urns, marked I and II. Urn I contains 4 red
balls and 6 black balls, and Urn II has 3 red balls and 2 black
balls. Since one of the Urns is to be selected at random for draw-
ing a ball both Urns have equal probability of being selected that
is
 P(x1) = p(x2) = ½ where, Urn I be denoted x1 and
Urn II be denoted x2
 There are four conditional probabilities from the two outcomes.
Red ball (y1) Black ball (y2)
p (y1/x1) = 4/10 p (y2/x1) = 6/10
p (y1/x2) = 3/5 p (y2/x2) = 2/5
 From the conditional probability p (x1/y2) that the ball is selected
belongs to Urn I (x1); given that it is a black ball (y2)
 Exercise:
 Suppose Urn I contains 4 red, 6 black, 2 white balls; Urn II con-
tains 2 red, 8 black, 4 white balls; and Urn III contains 6 red, 4
black, and 6 white balls. Further assume that two dies are thrown
together. Let Urn selection be based on the sum of die face points
as bellow.
 Urn I is selected for drawing a ball if the sum is equal to 5 or less.
 Urn II is selected for drawing a ball if the sum is equal to 8 or
more.
 Urn III is selected for drawing a ball if the sum is equal to 6 or 7.
a) Find the probability that the ball drawn belongs to Urn I when it is
known that it is a white ball.
b) Find the probability that the ball drawn belongs to Urn II when it
is known that it is a black ball.
c) Find the probability that the ball drawn belongs to Urn III when it
is known that it is a red ball.
 4.2 Probability Distribution
INTRODUCTION
 In many situations, our interest does not lie in the outcomes of
an experiment as such; we may find it more useful to describe a
particular property or attribute of the outcomes of an experi-
ment in numerical terms.
 For example, out of three births; our interest may be in the mat-
ter of the probabilities of the number of boys. Consider the
sample space of 8 equally likely sample points.
GGG GGB GBG BGG
GBB BGB BBG BBB
Now look at the variable “the number of boys out of three
births”. This number varies among sample points in the sample
space and can take values 0,1,2,3, and it is random –given to
chance.
 “A random variable is an uncertain quantity whose value depends
onAchance.”
random variable may be…
 Discrete if it takes only a countable number of values. For exam-
ple, number of dots on two dice, number of heads in three coin
tossing, number of defective items, number of boys in three births
and so on.
 Continuous if it can take on any value in an interval of numbers
(i.e. its possible values are unaccountably infinite). For example,
measured data on heights, weights, temperature, and time and so
on.
 A random variable has a probability law - a rule that assigns prob-
abilities to different values of the random variable. This probabil-
ity law - the probability assignment is called the probability distri-
bution of the random variable. We usually denote the random
variable by X.
 4.2.1 DISCRETE PROBABILITY DISTRIBUTION
 The random variable X denoting “the number of boys out of three
births”, we introduced in the introduction of the lesson, is a discrete
random variable; so it will have a discrete probability distribution.
 It is easy to visualize that the random variable X is a function of
sample space. We can see the correspondence of sample points with
the values of the random variable as follows:
GGG GGB GBG BGG
(X=0) (X=1)
GBB BGB BBG BBB
(X=2) (X=3)

 The correspondence between sample points and the value of the

random variable allows us to determine the probability distribution
of X as follows:
 P(X=0) = 1/8 since one out of 8 equally likely points leads to X = 0
 P(X=1) = 3/8 since three out of 8 equally likely points leads to X=1
 Cont’d
 P(X=2) =3/8 since three out of 8 equally likely points leads to X =
2
 P(X=3) = 1/8 since one out of 8 equally likely points leads to X = 3
 The above probability statement constitute the probability distribu-
tion of the random variable X = number of boys in three births. We
may appreciate how this probability law is obtained simply by as-
sociating values of X with sets in the sample space. (For example,
the set GGB, GBG, BGG leads to X = 1). We may write down the
probability distribution of X in table format.
 Probability Distribution of the Number of Boys out of Three Births
No of boys (X) Probability P(X)
0 1/8
1 3/8
2 3/8
3 1/8
 The probability distribution of a discrete random variable X must
satisfy the following two conditions:
1. P(X = x) ≥ 0 for all values x
2. ∑ P(X = x) = 1
all x
 These conditions must hold because the P(X = x) values are prob-
abilities.
 The first condition specifies that all probabilities must be greater
than or equal to zero.
 For the second condition, we note that for each value x, P(x) =
P(X = x) is the probability of the event that the random variable
equals x. Since by definition all x means all the values the ran-
dom variable X may take, and since X may take on only one
value at a time, the occurrences of these values are mutually ex-
clusive events, and one of them must take place.
 Therefore, the sum of all the probabilities P(X = x) must be 1.00.
 Cumulative Distribution Function
 The probability distribution of a discrete random variable lists the
probabilities of occurrence of different values of the random vari-
able.
 We may be interested in cumulative probabilities of the random
variable. That is, we may be interested in the probability that the
value of the random variable is at most some value x. This is the
sum of all the probabilities of the values i of X that are less than or
equal to x.
 The cumulative distribution function (also called cumulative
probability function) F(X = x) of a discrete random variable X is
 Cont’d
 For example, to find the probability of at most two boys out of
three births, we have

= P(x=0) + P(x = 1) + P(x = 2)

= 1/3 + 3/8 + 3/8
Discrete probability has three main classifica-
tions.
1. Binomial distribution
2. Hyper geometric distribution
3. Poisson distribution
1. Binomial Distribution
 Binomial Distribution: It deals with populations whose elements or
outcomes can be divided into two categories with reference to the
presence or absence of a particular attribute or characteristic. for
example answers to an exercise may be correct or incorrect, a
product may be defective or non defective etc...
 Characteristics of a and
It consist of n trials binomial distribution
each trial has only two outcomes, either of
which may be designated as a success or failures.
 The probability of a success p remains the same in all trials. Con-
sequently, the probability of a failure q = (1- p) also remains the
same in all trials.
 The number of successes in n trials can be expressed by the ran-
dom variable X that assumes discrete values from 0 to n.
 Repeated trials are independent since no definite pattern is in-
volved in the occurrence of either of the two outcomes in succes-
sive trials.
BD(b): b (x; n, p) = nCx . px . qn-x or nCx . px . (1-p)n-x
Where: nCx = n!
x!(n-x)!
µ = np ; = npq
 Cont’d
n! = is read as n factorial = n(n-1) (n-2) (n-3)......1
n = number of trials
p = probability of success
q = probability of failures
x = exact number of success in a trials (0, 1, 2, 3......n)
C = is the symbol for combination
µ = mean of binomial distribution
= Standard deviation of binomial distribution
= Variance of binomial distribution
Example : toss a coin 4 times; what is the probability of getting:
a) exactly two heads
b) exactly four heads
c) at most three heads
 Cont’d
Example: In the throw of a fair die, point 5 coming up is considered
a success with probability = 1/6. The probability of not getting
point 5, a failure is q (1-p) = 5/6. If the die is throw 4 times. Find
all the binomial probability?
Example: Suppose 60% of Management students pass Statistics for
Management I final examination and there were a total of 50 stu-
dents, find
a) the expected value of the number of success
b) standard deviation and variance
2. Hyper geometric Distribution
 Hyper geometric Distribution: deals with situations where a ran-
dom sample of size n drawn without replacement from a finite
population, and the resultant outcomes are classified into two cat-
egories (successes and failures) according to some characteristics
or attributes.
 Characteristics of hyper geometric distribution
 A random sample of size n is selected from the finite population
of N items without replacement; so that the probability of getting
a success is not the same in each trials.
 K out of N items comprising the population are classified as suc-
cess and (N-K) items as failures
HD(h): h(x; N, n, k) = h(x) = (kCx) (N-k)Cn-x
NCn
= n(
= n( ( (

Where; N = the size of the population

K = the number of successes in the population
n = the size of the sample or the number of trials
x = the number of success of interest, it may be 0, 1, 2, 3,..n
 Cont’d
Example: Assume that an Urn contains 6 red balls and 4 black
balls. If a sample of 4 balls is drawn from the Urn without re-
placement. find:
a) the probability of getting 2 successes out of 6 balls
b) the probability of all values of hyper geometric variables
c) the mean and the variance of hyper geometric distribution
Example: Suppose 50 play stations were manufactured during the
week. Forty operated perfectly and ten had at least one defect. A
sample of 5 is selected at random without replacement. What is
the probability that 4 of the 5 will operate perfectly?
3. Poisson Distribution
 Poisson Distribution: refers to the problem situation in which
occurrence an event and counting the number of times the event
occurs during the specified time intervals.
 Cont’d
 It is the number of occurrences of an event and not the non- oc-
currences in a given situations that is of interest.
 The events must be random and independent of each other.
Poisson Distribution = p(x) =
Where,
µ = is the average number of occurrence(successes) per unit of
time
e = is the base of natural logarithms and is equal to 2.718282
x = is the number of occurrence (success)
Example: Assume that on an average 3 persons enter the bank for
service every 10 minutes. What is the probability that exactly 5
customers will enter the bank in a given 10 minutes period, as-
suming that the process can be described by the Poisson distri-
bution.
 Cont’d
Example: Customers arrive at a photocopying machine at
an average rate of two every 10 minutes. the number of
arrival is distributed according to a Poisson distribution.
What is the probability that:
a) there will be no arrivals during any period of 10 min-
utes.
b) there will be exactly one arrival during this time pe-
riod.
c) there will be more than two arrivals during this period
 4.2.2 CONTINUOUS PROBABILITY DISTRIBUTION
(NORMAL DISTRIBUTION)
 The normal distribution is a continuous distribution and
plays a very important role in statistical theory and
practice particularly in the areas of statistical quality
control.
Characteristics of the normal curve
1) the normal curve is not a single curve representing only
one continuous distribution. It represents a family of
normal curve.
2) the normal curve is completely determine by the values
of mean and standard deviation which are its two pa-
rameters.
 Cont’d
3) the curve has a single peak at the center of the distribu-
tion. It has the same value for mean, median and mode.
4) the height of the curve declines as we go in either direc-
tions from the mean, but never touches the base so that,
the tails of the curve on both sides of the mean extend in-
definitely.
5) being bell-shaped, the normal curve is perfectly symmet-
rical about the vertical axis through the mean. As a result
50% of the area lies to the rights of the mean and the
other 50% to its left.
6) no matter what values of mean and standard deviation are
for a normal probability distribution, the total area under
the normal curve is 1.
 Cont’d
 The resultant Z values express the distance between
mean and the x values measured in terms of standard de-
viation.
Z = or x =
Z score is positive for values which are to the right of the mean
and negative to the left of the mean.
 Three different ways of measuring the area under the normal
curve
1) About 68% of the area under the normal curve is within ±1
standard deviation from the mean.
2) About 95.45% of the area under the normal curve is within ±2
standard deviation from the mean.
3) About 99.75% of the area under the normal curve is within ±3
standard deviation from the mean.
A) Finding the areas when the score is known
Example: The IQ scores of students is normally
distributed with mean of 120 and standard devia-
tion of 20. What proportion of students have:
a) An IQ between 100 and 130
b) An IQ above 140
c) An IQ below 150
d) An IQ between 140 and 150
 b) Finding the score when the area is known

Example: Taking the above mean = 120 and standard

deviation = 20 and answer the following questions:
a) find the score so that 20% of the students have an IQ
above this score
b) What are the limits within the central 50% of the
score lies?
c) find the score so that 70% of the students have an IQ
below this score.
 Exercise: The final examination scores in Statistics
are normally distributed with an average score of 70
and variance of 25.
a) If the lowest passing grade is 58, what percentage
of the class is failing?
b) If the professor gives the grades on a curve and ev-
erybody getting 82 or above gets a grade of A, then
what percentage of students get A grade?
c) If the highest 80% of the class are to pass the
course, what is the lowest passing score?
d) What should the score be so that only 15% of the
students get a score higher than this?
THANK YOU!!!

END OF THE 4th CHAPTER!!