JMP® Means Business: Statistical Models for Management

Chapter 5. Discrete Probability Distributions

• 5.1 Introduction to Distributions 106

  • 5.1.1 Random Variables 107

  • 5.1.2 Independent Events 107

  • 5.1.3 Discrete or Continuous Distributions 109

  • 5.1.4 Characteristics of Distributions 109

  • 5.1.5 General Shape of Distributions 110

• 5.2 Discrete Distributions 111

  • 5.2.1 Probability Function p(y) 111

  • 5.2.2 Cumulative Distribution Function F(y) 111

  • 5.2.3 Mean, Variance, and Standard Deviation 111

• 5.3 Binomial Distribution 113

  • 5.3.1 Binomial Distribution Characteristics 114

  • 5.3.2 Calculating Binomial Probabilities in JMP 115

  • 5.3.3 Practical Advice 117

• 5.4 Distributions of Two Discrete Random Variables (Y₁, Y₂) 118

  • 5.4.1 Return of Two Stocks under Different Economic Conditions 118

  • 5.4.2 Joint and Marginal Probability Functions ...