Handout7 - STOR 435 Handout 7 Sections 4.4-4.6 Example 1...

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STOR 435 Handout 7 Sections 4.4-4.6 Example 1 (Example 4a; Functions of a random variable) . X is a random variable with P ( X = - 1) = . 2, P ( X = 0) = . 5 and P ( X = 1) = . 3. What is E ( X 2 )? What is E ( X 2 )? Example 2 (Example 4b; Functions of a random variable) . A product that is sold seasonally yields a net pro±t of b dollars for each unit sold and a net loss of l dollars for each unit left unsold when the season ends. The number of units of the product that are ordered at a speci±c department store during any season is a random variable having probability mass function p ( i ) , i 0. If the store must stock this product in advance, determine the number of units the store should stock so as to maximize its expected pro±t. Example 3 (Variance) . 1. If X denotes the face that you observe when you throw a fair 6 faced dice, calculate var ( X ). 2. If Y denotes the outcome of an unfair 6-faced die where P ( Y = 1) = 1 / 3 , P ( Y = 2) = 1 / 9 , P ( Y = 3) = 1 / 18 P ( Y = 4) = 1
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This note was uploaded on 05/11/2011 for the course STOR 435 taught by Professor Shakar during the Spring '11 term at University of North Carolina School of the Arts.

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Handout7 - STOR 435 Handout 7 Sections 4.4-4.6 Example 1...

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