PPT-6.3: Binomial and Geometric Random Variables

63 Binomial and Geometric Random Variables After this section you should be able to DETERMINE whether the conditions for a binomial setting are met COMPUTE and INTERPRET probabilities involving binomial random variables. Zhang . Zhuozhuo. . Calum. Johnson . Waldemar. . Pietraszkiewicz. . The binomial model is a very useful and popular technique for pricing an option.. The binomial option pricing formula is based on assumption that the stock price follows a multiplicative binomial process over discrete intervals. . Karl L. Wuensch. Department of Psychology. East Carolina University. A Binomial . Experiment. consists of . n. identical trials.. each trial results in one of two outcomes, a “success” or a “failure.”. Chapter 17: . probability models. Unit 4. The basis for the probability models we will examine in this chapter is the . Bernoulli . (. Ber. -. Noo. -Lee) . trial.. We have Bernoulli trials if:. there are two possible outcomes (success and failure).. Distribution. If the probability that James is late home from work on any. day is 0.4, what is the probability that he is late home. t. hree times in a five-day working week?. L . L. . L. . L. ’ L’. Binomial distributions. are models for some categorical variables, typically representing the . number of successes. in a series of . n. independent trials. . The observations must meet these requirements: . Anthony Bonato. Ryerson University. East Coast Combinatorics Conference. co-author. talk. post-doc. Into the infinite. R. Infinite random geometric graphs. 111. 110. 101. 011. 100. 010. 001. 000. Some properties. http://www.answers.com/topic/binomial-distribution. Chapter 13: Bernoulli Random Variables. http://www.boost.org/doc/libs/1_42_0/libs/math/doc/sf_and_dist/html. /. math_toolkit. /. dist. /. dist_ref. II. BINOMIAL DISTRIBUTIONS A. Binomial Experiments 1. A binomial experiment is a probability experiment that satisfies the following conditions: a. The experiment is repeated for a fixed number of independent trials. B i nom i al & G eometr i c R andom V ar i ables Section 6.3 Reference Text: The Practice of Statistics , Fourth Edition. Starnes, Yates, Moore Objectives Binomial Random Variables and Binomial Distribution Textbook: Sections 8.4, 8.5, 8.6. • Recognize the four conditions for a binomial random variable. • Calculate the mean and standard deviation for a binomial random variable. • Use probability notation for continuous random variables and relate this notation to area under a density function.. Sit with your group and choose a team name. Preferably something corny that has to do with statistics . Today’s game will test your strength, wit, knowledge, and endurance! Remember… HW Passes are at stake folks! May the force be with you!. Anthony Bonato. Ryerson University. CRM-ISM Colloquium. Université. Laval. Complex networks in the era of . Big Data. web graph, social networks, biological networks, internet networks. , …. Infinite random geometric graphs - Anthony Bonato. mean and variance. Binomial Distribution. . KUS objectives. BAT use formulas to find the mean and variance of the binomial distribution. . Starter. : . . A company is searching for oil reserves. The company has purchased the rights to make test drillings at four sites. It investigates these sites one at a time but, if oil is found, it does not proceed to any further sites. At each site, there is probability 0.39 of finding oil, independently of all other sites. The random variable . 5.3. Binomial Random Variables. 5. Determine whether or not a given scenario is a binomial setting.. Calculate . probabilities involving a single value of a binomial random . variable.. Make . a histogram to display a binomial distribution and describe its shape..