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Consider the graph presented above, which represents number of emails I received
between 6 a.m. and 7 a.m.
•
Each arrow is an email (an occurrence).
The number of emails received in the one hour period (occurrences in a 1hr interval)
is a Poisson variable, which is discrete and countable.
•
The time between the emails received (segment of the line between arrows) is an
exponential variable, which is continuous and measurable.
Understanding the relationship between Poisson and Exponential Distributions
using an Example
Problem statement:
According to
Barron’s
1998 Primary Reader Survey, the average annual number of
investment transactions for a subscriber is 30 (
www.barronsmag.com
, July 28, 2000).
Suppose the number of transactions in a year follows the Poisson probability distribution.
A. Show the probability distribution for the time between investment transactions.
B. What is the probability of no transactions during the month of January for a
particular subscriber?
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This note was uploaded on 11/13/2011 for the course MBA 522 taught by Professor Nabavi during the Spring '08 term at Bellevue.
 Spring '08
 Nabavi

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