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mba 522 Poisson vs Binomial

# mba 522 Poisson vs Binomial - Let's compare Poisson to...

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Let's compare Poisson to binomial. In a binomial problem, the number of trials (n) sets the limit on the values that X can take. For example: 1) if the experiment is 6 questions that the student might guess on, and success event is guessing them correctly, then the X could take on the values: 0, 1, 2, 3, 4, 5, 6 b/c she might guess none correctly, or one , or two, or ..... , all the way to 6. 2) if the experiment is number of sales that a vendor makes when making 5 sales calls, then X will take on values: 0, 1, 2, 3, 4, 5 b/c he might make no sales or all the way up to 5 sales (if he's having a good day). So, in binomial variables, the number of trials "n" is the cap on the values that X can take on. Also, remember from ch. 4: the summation of the probabilities for all the X values must be 1.0. So, for all binomial variables the following holds: f(0) + f(1) + f(2) + ....... f(n) = 1.0 for a binomial random variable. Now, compare this with a Poisson variable. In this case, X is the number of occurrences in an interval of time or space. So, "theoretically", there is no limit

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mba 522 Poisson vs Binomial - Let's compare Poisson to...

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