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Unit I Lesson 4 Computing The Variance of A Discrete Probability Distribution

This document discusses how to calculate the variance and standard deviation of a discrete probability distribution. It provides steps for two different methods: 1) subtracting the mean from each value, squaring the results and multiplying by the probabilities, then summing; and 2) multiplying each value squared by its probability, summing, then subtracting the mean squared. Examples are worked through demonstrating how to apply the steps to find the variance and standard deviation. Exercises provide additional practice problems.

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Kira Milestone
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45 views

Unit I Lesson 4 Computing The Variance of A Discrete Probability Distribution

This document discusses how to calculate the variance and standard deviation of a discrete probability distribution. It provides steps for two different methods: 1) subtracting the mean from each value, squaring the results and multiplying by the probabilities, then summing; and 2) multiplying each value squared by its probability, summing, then subtracting the mean squared. Examples are worked through demonstrating how to apply the steps to find the variance and standard deviation. Exercises provide additional practice problems.

Uploaded by

Kira Milestone
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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COMPUTING THE VARIANCE OF A DISCRETE PROBABILITY

DISTRIBUTION
Lesson Objectives

At the end of this lesson, you are expected to:

• illustrate and calculate the variance of a discrete random


variable;
• interpret the variance of a discrete random variable; and
• solve problems involving variance of probability distributions.
Lesson Introduction

The variance and standard deviation describe the amount of


spread, dispersion, or variability of the items in a distribution.

How do you describe the spread or dispersion in a probability


distribution?
Discussion Points
Steps in Finding the Variance and Standard Deviation of a
Discrete Probability Distribution

1. Find the mean of the probability distribution.


2. Subtract the mean from each value of the random variable X.
3. Square the results obtained in Step 2.
4. Multiply the results obtained in Step 3 by the corresponding
probability.
5. Get the sum of the results obtained in Step 4.
Discussion Points

Illustrative Example:
The number of cars sold per day at a local car dealership, along
with its corresponding probabilities, is shown in the succeeding
table. Compute the variance and the standard deviation of the
probability distribution.
Discussion Points
Step 1.
Find the mean of the probability
distribution using the formula

μ=∑X• P(X)
Discussion Points
Step 2.
Subtract the mean from each value of the random variable X.
Discussion Points
Step 3.
Square the results obtained in Step 2.
Discussion Points
Step 4.
Multiply the results obtained in Step 3 by the corresponding probability.
Discussion Points
Step 5.
Get the sum of the results
obtained in Step 4. The result
is the value of the variance. So,
the formula for the variance is:

σ2 = Σ(X – μ)2 • P(X).


Discussion Points
Step 6.
Get the square root of the variance to get the standard deviation.

The variance of the probability distribution is 1.56.


The standard deviation is σ = √1.56 = 1.25.
Discussion Points
Discussion Points

Alternative Procedure in Finding the Variance and Standard


Deviation of a Probability Distribution

1. Find the mean of the probability distribution.


2. Multiply the square of the value of the random variable X by its
corresponding probability.
3. Get the sum of the results obtained in Step 2.
4. Subtract the mean from the results obtained in Step 3.
Example
Number of Heads

When three coins are tossed, the probability distribution for


the random variable X representing the number of heads that
occur is given below. Compute the variance and standard
deviation of the probability distribution.
Solution to Example
Step 1.
Find the mean of the probability distribution using the formula:
μ=∑X• P(X)
Solution to Example
Step 2:
Multiply the square of the value of the random variable X by its
corresponding probability.
Solution to Example
Step 3:
Get the sum of the results obtained in Step 2.
Solution to Example
Step 4:
Subtract the square of the mean from the results obtained in Step 3
to get the variance. So, the formula for the variance of a probability
distribution is given by σ2 = ∑X2 • P(X) – μ2

The standard deviation is the square root of the variance. Thus, σ =


√∑X2 • P(X) – μ2
Solution to Example
Step 4:
The variance is given by
σ2 = ∑X2 • P(X) – μ2
= 3 – (1.5)2
= 0.75

The standard deviation is


σ = √0.75 = 0.87.
Exercise 1 Complete the table below and find the variance and
standard deviation of the
following probability distributions.
Exercise 2
Find the variance and standard deviation of the probability
distribution of the random variable X, which can take only the
values 3, 5, and 7, given that P(3)= 7/30,P(5)=
1/3,andP(7)=13/30.

Exercise 3
The probabilities of a machine manufacturing 0, 1, 2, 3, 4, or 5
defective parts in one day are 0.75, 0.17, 0.04, 0.025, 0.01, and
0.005, respectively. Find the variance and standard deviation of
the probability distribution.
Exercise 4
The number of inquiries received per day by the Office of
Admissions in a certain university is shown below. Find the
variance and standard deviation.

Number of Inquiries X Probability P(X)


22 0.08
23 0.19
24 0.36
25 0.25
26 0.07
27 0.05
Summary
To find the mean of the probability distribution,

1. Find the mean of the probability distribution.


2. Multiply the square of the value of the random variable X
by its corresponding probability.
3. Get the sum of the results obtained in Step 2.
4. Subtract the mean from the results obtained in Step 3.

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