Math 300 , Spring 2004, Day 21, F, March 19 Hit reload...

Questions??
Variance of Hypergeometric, completed.
   Comment:  Cov(Xi, Xj) is negative!
   Why does this make sense/fit with what you know about correlation from Math 151/251?  covariance Negative
Negative correlation meant negative (downward) slope of the regression line: the "cloud" of data had a downward trend.
       Let N = 5, D = 3, n = 2.  X = # of Defectives. X1 is indicator for first ball, X2 is second. 
                                       Joint distribution:

Getting a 1 (Defective) on the first draw decreases the chances of getting a defective on the second; so the conditional probabilities for X2 average lower if X1 = 1 than if   X1 = 0 -- a downward trend.

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Derivation of E(X(X-1)) for Poisson Distribution, and how to get variance from it (B, Day 20)
  
(Microsoft Word file)

HW A.  Understand and finish the derivation of the variance for the Poisson distribution. 
          Compare with Ash's answer p233 6b (She uses the same "trick" but I think it's more obscure.)
B.  Application of covariance (since 20% of the class is Economics-oriented, and with luck the rest will someday have money to invest):  M&M, Investment portfolios.  Example 4.27, p. 332, problems 4.83, 84, 85 on p.339ff.
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HW  Read pp. 95-6.  Graph f(x) on p. 95 and g(x) on p. 96 --piecewise-defined functions (Prep. for  Ash Ch. 4, Next. )


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