Page 298 - DCOM203_DMGT204_QUANTITATIVE_TECHNIQUES_I

Unit 14: Poisson Probability Distribution

14.2 Features and Uses of Poisson Distribution Notes

Features

1. It is discrete probability distribution.
2. It has only one parameter m.
3. The range of the random variable is 0 r < .

4. The Poisson distribution is a positively skewed distribution. The skewness decreases as m
increases.

Uses

This distribution is applicable to situations where the number of trials is large and the probability
of a success in a trial is very small.

!
Caution When n, the number of trials become large, the computation of probabilities by
using the binomial probability mass function becomes a non cumbersome task.
Self Assessment

Fill in the blanks:
11. Poisson distribution is.................................. probability distribution.
12. Poisson distribution has ...................................
13. In Poisson distribution, range of the random variable is ...............................

14. The Poisson distribution is a ...................................distribution.
15. Poisson distribution is applicable to situations where the number of trials is ............................
and the probability of a success in a trial is .......................................

Case Study Poisson Distribution
C ustomers arrive randomly at a service point at an average rate of 30 per hour.
Assuming a Poisson distribution calculate the probability that:

1. no customer arrives in any particular minute.

2. exactly one customer arrives in any particular minute.
3. two or more customers arrive in any particular minute.
4. three or fewer customers arrive in any particular minute.

LOVELY PROFESSIONAL UNIVERSITY 293