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# Appendix A 188

APPENDIX A

A.1. Introduction
Many of the problems we face daily as industrial engineers have elements of
risk, uncertainty, or variability associated with them. For example, we can not
always predict what the demand will be for a particular inventory item. We can
not always be sure just how many people will shop at a grocery store and desire
to check out during a particular hour. We can not always be sure of the variation
in quality of raw materials from one of our suppliers. Not claim to be prophets
who can accurately predict results in ' we as industrial engineers are educated in
the use of applied statistics to make intelligent engineering decisions despite
our lack plate knowledge about future events.
The material presented in this appendix is meant to introduce you to
some of the basic laws of chance. Although the treatment is elementary, it is
sufficient to allow you to grasp the material on quality control project
management (PERT), and probabilistic models. Further grounding in
probability theory and statistics will come as more specialized courses on these
and other topics are studied. Since this text is written for students in the applied
professions, we shall avoid rigorous mathematical and deeply philosophical
treatments in of workable definitions and explanations.

## A.2. Basic Probability Theory

In the customary manner, we shall define an experiment as any process. Almost
all probabilistic experiments have more one possible outcome; otherwise, they
would be trivial from the view- point of probability theory. The number of
outcomes of an experiment may infinite. For example, when we inspect a
capacitor or diode, the outcomes are typically finite (either good or bad), but the
exact theoretical resistance measurement of a piece of wire could take on an
infinite number of values.

## A.2.1 Sample Space

The sample space of an experiment is the set of all possible outcomes pertinent
to the experiment. Depending on our interest, we may find that there are several
different ways of expressing the outcome. As an example, suppose that we
select two electric light bulbs and test them in order to determine whether or not
they light properly. If we are trying to distinguish completely all outcomes, we
might list the following set:
189 Appendix A

Bulb 1 Bulb 2

Light Light
Light Not light
Not light Light
Not light Not light
We note that there are four possible distinct outcomes to this
experiment.
It is just as valid for us to be interested only in the number of bulbs (out
of the two selected) that light, not in the specific ones that light. With this
interest, we have the following outcomes:

## Number of Bulbs that light

0
1
2
We note that there are only three outcomes to the experiment now. The
alert reader may observe that the outcome of one bulb lighting consists of two
outcomes from the first set-(light, not light) and (not light, light).
Any definition of an experiment should reflect distinguishable outcomes
according to the interest of the investigator. Many writers refer to the most
refined and detailed set of mutually exclusive (no two outcomes can occur
simultaneously) and exhaustive outcomes as the sample space. No matter how
we define the sample space, we often have an interest in various subsets of the
total set of outcomes. This interest will later lead to our definition of an event.

A.2.2 Probability
Let us consider a finite sample space and only a finite number of repetitions of
an experiment of a defined type. As an example, we define our experiment to be
the inspection of a reel of magnetic tape produced by a certain process during
the year. Each repetition of this experiment will consist of the examination of a
reel of tape (always different), the possible outcomes being accept, rework, and
reject. The number of repetitions corresponds to the number of reels of tape,
and the possible outcomes number only three; thus, both the number of
repetitions of the experiment and the number of outcomes are finite.
Returning to our general finite case, we let
ni = number of repetitions of the experiment that will result in outcome i
Appendix A 190

## k = number of different possible outcomes

N = total number of repetitions
n
It follows that the ratio i is the fractional number of the total number of
N
repetitions favorable to outcome i (frequency ratio of outcome i). We shall now
define probability with respect to this finite case as follows: The probability
n
p(xi) associated with outcome i is the frequency ratio i that is,
N
ni
p( xi ) (i 1,2,......... ., k ) ( A.1)
N
From this definition, the reader should easily be able to verify the following
characteristics of our probability function:
And p ( xi ) 0 (i 1,2,..............., k ) ( A.2)

p( x ) 1
i 1
i ( A.3)

Returning to our magnetic tape example, suppose that 100 reels are to be
inspected and that 50 are accepted, 30 are to be reworked, and 20 are rejected.
Figure A.l is one way of portraying this probability function geometrically. The
properties expressed by Equations A.2 and A.3 are seen to be true.

P(x)
0.6
0.5
0.4
0.3
0.2
0.1

0 1 2
(reject) (rework) (accept)

## Figure A.1: Probability Functions

In order to extend our ideas concerning probability, let us now consider
the possibility that the number of repetitions of an experiment approaches
infinity, whether or not the number of outcomes approaches infinity is
immaterial. Our definition of probability will now be extended as follows,
maintaining the same notation:
191 Appendix A

ni
p( xi ) lim (i 1,2,....,k ) ( A.4)
N N
The properties expressed by Equations A.2 and A.3 are still valid; with
the extension that k may also be infinite. Returning to our magnetic-tape
example, we might conceive of all the reels of tape that can ever be produced
(consider as infinite) and the outcomes might be the number (perhaps infinite)
of "bad" spots on a reel of tape. This example can now be considered as
consisting of an infinite number of outcomes and an infinite number of
repetitions of the experiment. The point of this extension is to use our
traditional approach to a limit whenever the number of repetitions approaches
infinity.
The most difficult case for us to handle conceptually involves an infinite
number of possible outcomes that we cannot count. Even when we talked about
the number of bad Spots on a reel of tape (perhaps infinite), at least we could
"count" or identify them with the real numbers, e.g., 1, 2, 3 That is, the out
comes were discrete. Continuous outcomes, however, are not countable. For
example, continuous outcomes may be the exact air pressure in a tire the
amount of rain in May, or the capacitance of a capacitor. Since we cannot count
these outcomes, we normally talk about subintervals of outcomes (e.g.,10-15,
15-20, 20-25, and so on, pounds per square inch tire pressure). These
subintervals are countable, and we can associate probabilities with them: For
example, the probability that the outcome x lies in the range from a to b is
written as follows:
p( x) p(a x b). for a b ( A.5)
It is apparent that interval probabilities obtained for a continuous random
variable are approximate because we are never absolutely sure about the
specific value of the outcome in the interval to be associated with the
probability.

f (x)

## Continuous distributions have a probability density function, f(x), as

illustrated in Figure A.2, instead of having distinct probabilities or weights,
Appendix A 192

p(x), at points, as in Figure A.I. Our new function f(x) has the following
properties:
f ( x) 0 ( A.6)

f ( x)dx 1 ( A.7)

And
b
p(a x b) f ( x)dx for a b ( A.8)
a

The reader should note that Equations A.6 and A.7 present the same
basic properties for continuous distributions as those given in Equations A.2
and A.3 did for discrete distributions. Equation A.8 is simply another way
stating Equation A.5.
In reflecting on our development of probability, we can say that a
number, called probability, is associated with each point of a discrete (finite or
infinite) sample space. For a continuous sample space (always infinite),we
developed a way of representing probability as the area under a curve between
limits, such area being computed through the use of the calculus. The curve
itself is a probability density function.

A.2.3 Events
An event is a subset of the sample space of an experiment. It may consist of
none of the outcomes (void), some of the outcomes, or all of the outcomes.
Returning to our light bulb example, let us consider the event that (of the bulbs
tested) exactly one bulb lights. Regardless of how we defined our sample space
above, the event that one bulb lights represents a subset of some of the
outcomes of the sample space.
Two events are said to be mutually exclusive if the occurrence of one
excludes the occurrence of the other; that is, they do not possess any points in
common from the sample space. For example, it is clear that the event of
neither bulb lighting and the event of both bulbs lighting are mutually exclusive
for that sample space. It should be apparent that the mutually exclusive property
of events must be considered with respect to the sample space.
As a further example linking sample space and events, a group of 100
items are taken for inspection. We are interested in the number of defectives in
this group. If 10 or fewer defectives are found, we shall conclude that the
manufacturing process from which the items were taken is operating
satisfactorily. The sample space for our inspection would include 101 different
possible outcomes-that 0, 1, 2, ..., 99, or all 100 items are defective. The event
that we conclude that our manufacturing process is operating satisfactorily is
193 Appendix A

be defective.

## A.2.4 Probability of an Event

An event may consist of any combination of possible outcomes of an
experiment. It is up to the experimenter to define events that are meaningful to
him in his experiment. Let us consider the experiment of drawing one ball from
a box containing ten balls, numbered 1, 2, ..., 10. The balls numbered 1 through
5 are black; those numbered 6 through 10 are white. The probability of drawing
any particular one of the ten balls on any performance of the experiment is 0.1.
We can define many events relating to the experiment of drawing one ball from
the urn as follows:
E1 is the event of drawing an even-numbered ball.
E2 is the event of drawing a black ball.
E3 is the event of drawing an even-numbered black ball.
E4 is the event of drawing a ball larger than 6.
E5 is the event of drawing a ball less than or equal to 4.
Many other events could be defined for this experiment, but we shall
discuss only these five events and the way in which each event could occur.
There are five outcomes by which event E1 can be realized. We shall say that
five of the ten possible outcomes of the experiment are favorable to E1. Since
each outcome is equally likely to occur in this example, the probability event
E1 is 0.5. Notationally, we have

p ( E1 ) 0.5
By similar reasoning, we see that the probabilities of the remaining events are

p ( E 2 ) 0.5
p ( E3 ) 0.2
p ( E 4 ) 0.4
p ( E5 ) 0.4

## In general, the probability of event E is the sum of the probabilities 01

the outcomes of which E are comprised. We must remember, of course, that in
the case of a continuous distribution, always with an infinite number of
outcomes, an event consists of one or more intervals of outcomes; therefore, the
probability of such an event is the sum of the areas under the density curve
corresponding to the intervals of outcomes comprising the event.

Appendix A 194

## In order to begin to use our probability definition, we need a definition. Two

events are said to be equally likely if each event has the same probability of
occurrence. Two events are said to be independent if the occurrence of one
event in no way affects, or is affected by, the occurrence of other event. The
intersection of the events A and B (denoted by AB) consists of all the sample
space points corresponding to both A and B. The union of events A and B
(denoted by A + B) consists of all the sample space points corresponding to
either A or B (or both).
We express the multiplication theorem for events A and B as follows:

p( AB ) p( A / B) p( B ) ( A.9)

Where P(A/B) is read "the probability that A occurs given that B has
occurred." If events A and B are independent, then P (A /B) equals p (A) and
Equation A.9 can be written in the following form:
p( AB) p( A) p ( B ) ( A.10)

The conditional probability of the event A, given that event B has also
comes from Equation A.9 and is given as follows:
p( AB )
p( A / B) ( A.11)
p( B)

## The addition theorem for probability is indicated by the following:

P( A B ) P ( A) P( B ) P ( AB) ( A.12)

## If A and B are mutually exclusive, then we obtain the simplified form of

Equation A.12 as follows:
P( A B) P( A) P( B) ( A.13)
These rules must be extended whenever more than two events are
involved. As an example, imagine a subsystem comprised of two main
components, A and B. They are produced independently, and the defective
proportions of A and B are, respectively, .2 and .3. The probability of the event
that both A and B are defective in a subsystem is given by the multiplication
theorem in Equation A.10 and equals (.2) (.3) = .06. The probability that r either
component A or B (or both) is bad, resulting in defective subsystem, is given
by Equation A.12 and equals .2 + .3 -.06 = .44.

A.3 Combinations
In considering problems involving finite sample spaces of equally likely
outcomes, we are often tempted count the frequencies of interest. This
195 Appendix A

## procedure is perfectly valid, but counting may be time-consuming; tedious.

Therefore, we most often use a formula to determine numbers of combinations.
The number of combinations of n things taken k at a time is expressed by the
following notation and formula:
n!
C n,k n, k ( A.14)
k!(n k )!
For example, we may want to know the number of ways in which two
defective items can be observed in a sample of four parts. If (l, 2) indicates that
the defectives were the first and second items observed, we can extend this
notation to show the other possible ways the inspector might have encountered
the defectives as (1,3), (1,4), (2,3), (2,4), and (3,4). In all, we count six ways.
Using Equation (A.14), we can solve this problem by using n = 4 (sample size)
and k = 2 (number of defectives) as:
4! 4 x3x2 x1
6
2! 2! 2 x1 x 2 x1

## A.4 Random Variables

A random variable is a numerically valued variable defined on a sample -.For
each point of the sample space, the random variable would be assigned a value.
This definition should be considered in the most gel terms: The random variable
may be positive or negative; it may have same value at different points of the
sample space, it may be either discrete or continuous, and so forth. In other
words, we may treat a random van. as we have treated other mathematical
variables. For our light bulb example with four outcomes in the sample space,
we might define the random v able x as follows:
x = 0 for the sample point (0, 0)
x = 1 for the sample point (1, 0)
x = 2 for the sample point (0, 1)
x = 3 for the sample point (1, 1)
Or we might decide that the random variable x should be the number
bulbs that burned of the two tested; thus, for the sample space, x would define
as follows:
x = 0 for (0, 0)
x = 1 for (1,0) and (0 ,1)
x = 2 for (1, 1)
In considering our magnetic tape example we might define the random
variable to be the number of "bad" spots on a reel of tape. Theoretically, the se
of values that such a random variable would have consists of zero and the
natural numbers.
The above examples illustrate discrete random variables. Many
measurements, however, define a continuous random variable, even though our
Appendix A 196

## measurements are limited to being discrete. The lengths of belts produced by a

production process should be continuous. Measurements of temperature, speed,
voltage, amperage; and so on, give rise to continuous random variables.
The word random in random variable means that the variable will
assume its values in a chance manner. As long as the values of the variables are
equally likely to occur, then our concept of randomness seems sensible. We
should recall, however, that different values of the random variable may have
different probabilities of occurring. This happens when the events that
correspond to the values of the random variable are not equally likely.
In practice, it is important that we choose our random variable carefully.
Of course, we desire the random variable that correctly expresses the item of
interest. This choice is left to the investigator. Consider a problem concerned
with machine breakdowns. Our random variable might be the r breakdowns per
day, the time between breakdowns, the number of simultaneous breakdowns,
the time required to repair breakdowns, and a host of other possibilities. Every
problem must be individually analyzed and pertinent random variable must be
chosen and defined.
The importance of understanding random variables cannot be over-
emphasized. The result of any experiment is a random variable unless that
result can be predicted with certainty. Some examples of experiments whose
outcomes are random variables are as follows:
Number of defective items observed in a sample (discrete);
Average dimension of items sampled and measured (continuous);
Rain or no rain on any given day (discrete);
Amount of rainfall on any given day (continuous);
Launch or abort on any attempted missile shot (discrete);
Success or failure on a missile launch (discrete);
Accuracy of a missile launch (closeness to intended target)
(continuous);
The temperature in a petroleum refining process (continuous);
The number of whole barrels of gasoline produced by a petroleum
refining process in a given time period (discrete); and
The voltmeter reading (assuming no instrument error) of a
residential electrical circuit (continuous).
The examples above are random variables because the value of any
particular performance of each of the experiments cannot be predicted with
certainty.

## A.5. Discrete and Continuous Distributions

Associated with every random variable is a probability distribution. As a matter
of fact, we have already encountered two probability distributions in Figures
197 Appendix A

## A.1 and A.2. A probability distribution of a random variable is just that: a

distribution, or portrayal, of the probabilities of occurrence of each value (or
interval of values) of the random variable. The probability distribution that we
have already encountered in Figure A.1 is "discrete" because the particular
random variable is discrete (accept, reject, rework). The distribution shown in
Figure A.2 is obviously continuous. The presentation in this section will include
both the discrete and continuous cases. We should always bear in mind that the
nature of the random variable determines whether a distribution is discrete or
continuous.
In addition to the mathematical representation of a distribution, we are
often interested in measures that further describe the properties of a universe
under study. Two very popular characteristics of a distribution are the mean and
variance of the random variable. The mean is a measure of central tendency and
represents somewhat of an average value. The variance is a dispersion or
distribution spread. The mean is often represented as and the variance as
2 . We often speak of the standard deviation is the positive square root of the
variance. The standard deviation is represented as sigma ( ).

## A.5.l Discrete Distribution Properties

A discrete probability distribution is a function p(x) of the discrete random
variable x yielding the probability p(xi) that x will assume the value xi . Such a
function is often called the frequency function of a discrete random variable.
The defining characteristics of such a function are given by the following
mathematical statements:

## p(x i ) 0 (i 1,2,..., k) (A.15)

p(x ) 1
i 1
i (A.16)

Of course, Equations A.15 and A.16 are repeats of Equations A.2 and A.3.
Much of our work with distributions involves cumulative probabilities
that is, the probability that the random variable will assume one of a set of
possible values. The discrete cumulative distribution is defined as fol1ows:

F (a ) p( x a) p( x )
xi a
i ( A.17)

F (a) is the probability that x will have any value less than or equal to a.
A useful result of Equation (A.17) is that
Appendix A 198

p ( xi ) F ( xi ) F ( xi 1 ) ( A.18)
Thus, the discrete probability distribution and the discrete cumulative
distribution are equivalent, since either can be obtained from the other. Figure
A.3 is the discrete cumulative distribution corresponding to Figure Note that
according to our definition it is a step function.

F(x)

1.0
0.8
0.6
0.4
0.2

0 1 2 x
Figure A.3: Discrete Cumulative Distribution.

## In practice, it has been found that a few discrete probability distributions

closely approximate many naturally occurring distributions. The next three
sections will briefly present some of these distributions.

## A.5.2 Binomial Distribution

Suppose that we consider n independent experiments, each of which has only
two possible outcomes. For example, inspecting and classifying n items as good
or bad meet our description. If our random variable is the number of
occurrences of a particular outcome, such as bad items, we can see that the
possible values of the random variable are 0, 1, ..., n.
For convenience in discussion, let us agree to refer to the occurrence of
a particular outcome (e.g., bad items) as a "success" and the alternative
outcome as a "failure." Now, by considering n independent and identical "two
outcome" experiments, with a "success" having the probability p and a "failure"
having the probability q = 1 -p, we can explore the probability of "x successes,"
where x n . First, the number of ways we can obtain x successes is the
number of combinations of n things taken x at a time, that is,
199 Appendix A

n n!
c ,xn
x x!(n x)!
By recalling our multiplication rule for independent events, we note that
each such combination has a probability of p x q n x of occurring. Thus, the
probability of x successes in n independent and identical experiments may be
written as follows:

n x n x
p(x;n,p) p q (A.19)
x
Where x = 0, 1, ..., n.

## The probability distribution expressed by Equation A.I9 is called the binomial

probability distribution. Its cumulative binomial probability distribution is as
follows:
a (A.20)
F (a ; n, p) p ( x; n, p) ( A.20)
x o
For a = 0, l,...,n.

Also, the mean and variance of the binomial are given by the following:

np (A.21)
npq
2
( A.22)
As an example of the binomial distribution, assume that we randomly select six
transistors from a production line. Past data have indicated that 10% of the
transistors inspected are found defective. We can determine i probability of
finding exactly two defective transistors by using Equation A.19 as
Appendix A 200

6 2 4
p(2;6,.1) 0.1 *0.9 .098.
2
Similarly, using Equation A.20, we can find the probability of detecting two or
fewer defectives as
2
F ( 2;6,0.1) p ( x;6,0.1) 0.984.
x 0

The binomial density function for this example is graphed in Figure A.4.

0.532

0.354
Probability
0.098
P(x:6 ,0.1)
0.015
0.001 0.000 0.000
0 1 2 3 4 5 6 x
Number of Defects

## A.5.3 Poisson Distribution

The Poisson distribution is applicable in many situations in which some kind of
event (such as a "flaw" or a "change") occurs randomly in over distances, areas,
or volumes. To be consistent with our earlier terminology, we shall continue to
call the occurrence of an event a "success. The Average rate of occurrence of
the event is considered constant in a Poisson process and is denoted by . The
probability of x successes in f a constant average occurrence rate is
x
p ( x; ) e ( A.23)
x!
201 Appendix A

## Where x = 0, 1, 2, In addition to being a distribution in its own right, the

Poisson distribution is a good approximation to the binomial when n is large
and p is small. Some writers recommend this approximation if
np 5 and p .1.

## We can express the cumulative Poisson as follows:

a
F (a ; ) p ( x ; ) ( A.24)
x 0

For the Poisson distribution, we obtain values of the mean and variance as
follows:
(A.25)
2 ( A.26)
In other words, the variance and mean are identical.
Some examples of use of the Poisson distribution are provided by the number
of imperfections on a sheet of metal, the number of diseased spots on a tree, the
number of weeds on a plot of land and so forth. When we use the Poisson, we
should remember that the random variable can assume the set of numbers 0, 1,
2, ..., which is a countable infinite discrete set.

## A.5. 4 Uniform Distribution

Uniform distribution is a very easy distribution to analyze and one of the most
common. We shall define our random variable so that it can assume a finite and
discrete set of values. We define the uniform distribution as follows:
1
p ( x ; n) ( A.27)
n
For x = 1, 2,.,n. we can see that the cumulative distribution is
k
F ( a ) p ( x ; n) ( A.28)
x a n
Where k is the number of values of x less than or equal to a.
The mean and variance of the uniform distribution are given as follows:

n 1
( A.29)
2
And

n2 1
2 ( A.30)
12

## We can see that the real distinguishing characteristic of the uniform

distribution is that each value of the random variable has the same probability
Appendix A 202

## of occurring. Despite the obvious character of the uniform distribution, we

should recognize it as a distinct probability distribution.
As an example, suppose that four finalists have been selected drawing.
The finalists are numbered 1, 2, 3, and 4. Only one top prize is given. The
probability that finalist number 3, say, is chosen is given by Equation A.27 as
1/4. The probability that finalists 1, 2, or 3 are selected is given by Equation
A.28 as F (3) = 3/4. The probability of any of the four finalists being chosen is
illustrated in the uniform density function graphed in Figure A.6.

Probability
0.098
P(x;n)

1 2 3 4 x
Item Number

## A.5.5 Continuous Distribution Properties

A continuous probability distribution is a function f(x) of' random variable x
that possesses the following properties:

f ( x) 0 ( A.31)

f ( x)dx

1 ( A.32)

and
b
P(a x b) f ( x)dx for a b ( A.33) these
a

properties are, of course, just a repeat of equations A.6, A.7 , and A.8 . such a
function is often called either a density function of a probability density
function.
The continuous cumulative distribution is defined as follows:
203 Appendix A

a
F (a) f ( x)dx

( A.34)

F(a) is the probability that the random variable x will have any value
less that or equal to a . If the derivative of F exists , we have the following:
F ' ( x ) f ( x) ( A.35)
Thus, with nice mathematical properties the existence of either f(x) or
F(x) determines the other.
We should recall that f(x) is a density type of function instead of a pure
probability function. By integration we actually obtain probability. That is, we
can specify the probability that a random variable well assume a value between
two points; however, the probability for any single point is zero.
In considering our integral definition of F(x), we may find in practice
that our continuous probability distribution f(x) is defined only over a part of
the real-number axis. In such cases, we simply extend the definition over the
total axis by assigning f(x) the value of zero elsewhere. This extended definition
may require integrations over subintervalsa valid operation mathematically.

## A.5.6 Normal Distribution

We shall define the general form of the normal distribution of the continuous
random variable x as follows:

1 2 2
f ( x) e ( x ) / 2 A.36
2

for x
This distribution is one of the most interesting and useful that we study. It has a
single peak at the mean and is symmetrical about that point. If we plot an
example of a normal distribution, it will be readily apparent that it is bell-
shaped with mean and variance 2 .
In practice, many distributions are well approximated by the normal
distribution. Some examples include bolt diameter construction errors,
resistance of a specified type of wire, weight of a packaged material, and so on.
We can show mathematically that if a random variable is distributed
normally with mean and variance 2 , then the standardized normal
variable z = (x )/O" is distributed with zero mean and unit variance using the
transformation of the standardized normal random variable can derive the
standard normal distribution, which is

1 2/2
f (z) e z ( A.37)
2
Appendix A 204

For - < z < . Since we can always make the standard transform in
practice, we shall use this function in Table B.2. Since the cumulative Equation
A.37 cannot be derived in closed form, the tables represent result of numerical
integrations.

## A.5.7 Exponential Distribution

One very useful continuous probability distribution is called the exponential
distribution. It is most commonly used when we are interested distribution of
the interval (measured in minutes, for example) between successive
occurrences of an event. The probability function associated with the
exponential random variable is as follows:

## f ( x) e x for x 0 and 0 ( A.38)

and f(x) = 0 for x 0. The cumulative distribution of the exponential random
variable is as follows:
a
F ( a ) e x dx 1 e a ( A.39)
0

1
( A.40)

1
2 ( A.41)
2

## There is an interesting relationship between the exponential distribution

and the discrete Poisson distribution in problems involving the occurrence of
events ordered in time. In the Poisson case, there are changes occurring
intermittently in the process in which we are interested. The Poisson
205 Appendix A

distribution describes the number of such changes in a unit time interval. The
exponential distribution describes the time spacing between such occurrences.
Suppose that the life in hours of a certain type of tube is a random
variable having an exponential distribution with a mean of 1000 hours. What is
the probability that such a tube will last at least 1250 hours? To solve this, we
use the cumulative distribution expression in Equation A.39 as follows:

F ( a ) 1 e a
1
= 1 e (1250)
1000
= .713
This is the probability that the tube will last 1250 or fewer hours; hence,
answer to our questions is 1 -F(1250) = .287. The exponential distribution for
this example is illustrated in Figure A.8.

Appendix A 206

## A.5.8 Rectangular Distribution

A continuous probability distribution that has constant density over the range of
values for which the density of the random variable is nonzero is called a
rectangular distribution. The probability distribution associated with the
rectangular random variable is as follows:
1
f ( x) for c x d ( A.42)
d c
and f(x) = 0, otherwise. The cumulative distribution of the rectangular random
variable is as follows:
a 1 ac
F (a) dx ( A.43)
c d c d c
The mean and variance of the rectangular distribution are given by the
following equations:
cd
( A.44)
2

( d c) 2
2 ( A.45)
12

## Suppose that the demand for a particular bulk fluid inventory i

rectangular between 100 and 1100 gallons per day. Using Equation we see that
the probability that no more than 700 gallons will be required is

700 100
F (700) .6
1100 100
The rectangular distribution for this example is graphed in Figure A. 9.

f(x)

1
1100

100 1100 x

207 Appendix A

## A.5.9 Distribution Summary

Table A.1: Common Distribution Summary

Distribution
of random Formula Parameters Range of x Mean Variance
variable x
Discrete
Binomial n n, p x 0,1,2,3...., n np np (1 p )
f ( x) P x (1 P ) n x
x

Poisson e x x 0,1,2,3.....
f ( x)
x!
Uniform 1 n x 1,2,3,...., n n 1 n2 1
f ( x)
n 2 12
Continuou
s
Normal
f ( x)
1 ,/
e ( x )
2
2 2 x 2
2
Exponential f ( x ) e x 0x 1 1
2
Rectangular 1 c, d cxd c d (d c) 2
f ( x)
d c 2 12

## Table A.1 summarizes the important points of the common distribution

treated in this section. The formula parameters, range, mean, and variance are
presented in the table for easy reference.

## A.6. Expected Values and Variability

We earlier introduced the distributional characteristics known as m and
variance. In this section we shall elaborate upon those measured from the
viewpoint of expected values.

A.6.1 Mean
The mean or expected value of a discrete random variable x is denoted by the
letter and is defined as follows:
E ( x ) x i p ( xi ) ( A.46)
i

## Where P ( xi ) is the probability that x takes on the value xi .In an analogous

manner, we define the mean or expected value of a continuous random variable
as follows:
Appendix A 208

E ( x ) xf ( x)dx ( A.47)

## Where f(x) is the continuous probability distribution of x. It is interesting to

note that the mean need not equal a value that the random variable may assume.
For example, the expected value or mean of many dice rolling experiments is:

xi p ( x i )
1

1 1 1
1 2 .... 6
6 6 6
= 3.5

The value 3.5 is clearly not a value that can be assumed on a roll of the die.

A.6.2 Variance
The measure of variability that we have considered is called the variance ( 2 ),
and it is defined as follows:

2 E(x ) 2 ( A.48)

This definition holds for both discrete and continuous random variables. The
reader should note that the following computational convenience holds:

## Using Equation A.49, we can determine the variance of the distribution

for rolling a die in a manner similar to finding the mean. That is,

2 E( x 2 ) 2

= xi
2
i p( xi ) 2

1 1 1
= 1 2 ... 6 (3.5)
2 2 2 2

6 6 6
= 2 .917
For the reader familiar with mechanics, we can point out an interesting
analogy. The mean is analogous to the first moment about the origin, and the
variance is equivalent to the second moment about the mean.
The mean and variance are fixed for a given distribution; thus, they are
parameters of the distribution. For our purposes, the use of expected values
provided a nice medium for defining the mean and variance.
209 Appendix A

## A.7. Populations and Samples

Much of the work of the applied professions involves the study of only a subset
of the total items of interest, in the hope of making statistical inferences about
the total. An engineer might collect data on machine utilization for 1 month,
hoping to infer from it machine utilization information for many months or
years. An automobile manufacturer might test a small number of automobiles
and then make generalized statements about all the auto-mobiles produced
during that model year. An inspection team might use destructive inspection on
a small percentage of items in order to infer characteristics of the total number
being produced. In order to describe this process accurately, we must clearly
understand the meaning of populalation and sample.

A.7.1 Population
A population, in the broadest sense, is the total set of element about which
knowledge is desired. Some populations are relatively small, for example the
number of Atlas missiles; other populations are large, for example, all the
electric light bulbs now in existence and to be produced in the future. All
elements of a population do not have to be in existence, as the last example
indicates. The important thing to remember is that the population must be
definable.
The definition of population clearly indicates that it contains the
elements in which we have an interest. Why, then, do we not study the complete
population? The answer is simple: The population is usually too large or too
complex, or not available, or the expense of considering all of it is too high.
Any investigator would measure all the elements of his defined population if it
were not prohibitive in some manner. As a result of the impossibility or
impracticality of always considering all elements of a population, we are forced
into a consideration of a sample (or samples) from that population.

A.7.2 Sample
A sample is a subset of a population. In extreme situations, the sample may be
the complete population or it may consist of no elements at all. Of course, this
latter sample would yield no information and we shall not consider it further.
Remember that the purpose of a sample is to yield inferences about the
population from which it was taken.
The two most important features of a sample are its size and the manner
in which it was selected. Much of the study of sampling statistics concerns the
determination of these two characteristics. As expected, this determination is
based upon the specific conditions prescribing the purpose of the sample.

Appendix A 210

## A sample statistic is a value calculated from a sample that may be used to

estimate a population parameter such as a mean or variance. Since samples
from a population are not identical, it is immediately apparent that sample
statistics are not always the same, that is, they vary from sample to sample.
Thus, a sample statistic is a random variable with its own frequency function.
Two important sample statistics are the sample mean and the sample
variance. The sample mean is defined as follows:
n
x
x i ( A.50)
i 1 n

where n is the number of measurements in the sample and the xi ' s are the
values of the random variable x in the sample. The sample variance is defined
as follows:
2

n x i x
s2 ( A.51)
i 1 n 1

For computational purposes, the sample variance can also be written as follows:
2
n
n
xi
2 i 1
xi
n
s 2 i 1 ( A.52)
n 1

In this form, s 2 is much easier to calculate. As we might expect, x is
an estimate of the population mean and s 2 is an estimate of the population
variance 2 .
Other measures of central tendency include the median, which is the
middle value in an ordered set of data, and the mode, which is the value that
occurs most frequently. The range, denoted by R, is a particularly useful
measure of dispersion in quality control work. It is simply the largest value in a
sample minus the smallest value:
R xl arg est x smallest ( A.53)

## A.7.4 Distributions of Sample Means

We often make inferences about a population from the average value of a
sample. This usually requires that we know the parameters of the distribution of
means. Naturally, the expected value of the sample average is p, the same mean
211 Appendix A

2
value as held by the population. The variance of the sample means x differs
from the population variance and is given by the following:
2
x ( A.54)
n
It is reasonable to expect that the distribution of sample means to have a
smaller variance, since the larger the sample, the closer one would expect the
average to fall to the population mean, giving rise to a smaller distribution
We can return to our example in which resistors are normally distributed
with mean = 1000 and variance 2 = 900. If we take sample on size n= 9
and average the ohmmeter readings, it is virtually impossible that the sample
average will be as high as 1060 which had a .0227 probability for a single
resistor. In fact, the likelihood that the sample average will exceed 1030 is very
small. To calculate the exact probability, we must first determine the mean and
variance of the sample average distribution. The mean will remain at 1000,
but the variance is given by

2 2 900
x 100
n 9
Finding the standard normal variable, we have

x 1,030 1,000
z 3
10
x
Consulting our Table B.2 values in Appendix B, we can see that probability that
z exceeds 3 is 1 -.99865 = .00135. Correspondingly, this is also the probability
that x will exceed 1030.

The distributions of x and x for this example are graphed in Figure A.10.
Appendix A 212

## A.8. Central Limit Theorem

In the preceding example, we implicitly assumed that the distribution of sample
means to be normal. In fact, this is true if the population is normally distributed.
Although the sample mean distribution is not truly normal if the distribution is
other than normally distributed, we frequently treat the sample means as if they
were. The reason we can do this is stated in the central limit theorem which, in
essence says: If x has a distribution with a finite variance 2 , then the random

variable x has a distribution that approaches normally as the sample size
trends to infinity. Fortunately, for many population distribution often
encountered, sample sixes as low as n = four produce sample average
distributions which are workably close to normal. We use the central limit
theorem extensively in quality control, project management, and probabilistic
model.