classical definition of probability - ANSWER-If the process that generates the outcome is known, probabilities can be deduced from theoretical arguments, this is the ______
Relative Frequency - ANSWER-based on empirical data. The probability that an outcome will occur is simply the relative freq...
classical definition of probability - ANSWER-If the process that generates the outcome
is known, probabilities can be deduced from theoretical arguments, this is the ______
Relative Frequency - ANSWER-based on empirical data. The probability that an
outcome will occur is simply the relative frequency associated with that outcome.
subjective definition of probability - ANSWER-based on judgment and experience as
sports experts might predict at the start of the football season—what is the probability of
a specific team winning the national championship?
Random Variable - ANSWER-a numerical description of the outcome of an experiment
discrete random variable - ANSWER-when the number of possible outcomes can be
counted
continuous random variable - ANSWER-has outcomes over one or more continuous
intervals or real numbers
The ____ of a random variable corresponds to the notion of the mean or average for a
sample - ANSWER-expected value
Joint Probability - ANSWER-the probability of the intersection of two events
Conditional Probability - ANSWER-the probability that one event happens given that
another event is already known to have happened
How is the variance of a discrete random variable computed? - ANSWER-as a weighted
average of the squared deviations from the expected value
What does high variance mean in a random variable - ANSWER-high uncertainty of the
outcome
Bernoulli Distribution - ANSWER-The probability distribution of a random variable with
two possible outcomes, each with a constant probability of occurrence.
Poisson distribution - ANSWER-a discrete probability distribution describing the
likelihood of a particular number of independent events within a particular interval
Normal Distribution - ANSWER-a bell-shaped curve, describing the spread of a
characteristic throughout a population
, When does mean=median=mode? - ANSWER-For normally distributed data
What is the range of X in a normal distribution? - ANSWER-it is unbounded, meaning
that the tails of the distribution extend to negative and positive infinity.
The empirical rules apply exactly for _______ - ANSWER-Normal Distribution
Probability density functions - ANSWER-The distribution that characterizes outcomes of
a continuous random variable.
Properties of Probability Density Functions: - ANSWER-• A graph of the density function
must lie at or above the x-axis.
• The total area under the density function above the x-axis is 1.
• For continuous random variables, there are an infinite number of values.
• Calculates the probability of a random variable lying within a certain interval such as
between two numbers, or to the left or right of a number.
• P is the area under the density function between a and b.
Regression Analysis - ANSWER-tool for building mathematical and statistical models
that characterize relationships between a dependent variable (ratio) and one or more
independent, or explanatory, variables (ratio or categorical), all of which are numerical.
Simple regression - ANSWER-A regression model that involves a single independent
variable
Multiple Regression - ANSWER-A regression model that involves two or more
independent variables
What shows steady increase or decrease over the range of x and is the simplest type of
function used in predictive models? - ANSWER-Linear Functions
Logarithmic Functions - ANSWER-are used when the rate of change in a variable
increases or decrease quickly and then levels out, such as diminishing returns to scale.
Polynomial Function - ANSWER-A second-order polynomial is parabolic in nature and
has only one hill or valley, a third-order polynomial has one or two hills or valleys.
Revenue models that incorporate price elasticity are often polynomial functions.
________ have the property that y rises or falls at constantly increasing rates. -
ANSWER-Exponential Functions
_____ define phenomena that increase at a specific rate - ANSWER-Power Functions
R-Squared - ANSWER-is a measure of the "fit" of the line to the data and will have a
value between 0 and 1. The larger the value, the better the fit.
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