Binomial Distribution
to
Analysis Of Statistical Data


Binomial Distribution
to
Business Analysis Made Easy


Binomial Distribution


A special case of the poisson distribution


The binomial distribution (BD) is one of the most important distributions in statistics. This distribution is the discrete probability distribution (the variable can take only fixed values) of the number of successes in n independent trials, each with the same probability of success or failure.


Suppose a coin is tossed ten times. The probability of the coin showing heads or tails is ½ (p=0.5; both are equally likely). The BD for this success /failure experiment (also known as a Bernoulli trial), expressed as b (10,5) is the probability distribution of how many times the coin will show heads.


Processes That Exhibit A Binomial Distribution


BDs are characteristic outcomes of the processes in which following conditions are met:



Statistics of Binomial Distribution



Example of Using the Binomial Distribution:




Binomial Distributions

Normal Approximation of
the Binomial Distribution


If the number of trials is large (n>20) and the probability of success and failure are almost equal, then the binomial distribution can be approximated by the normal distribution. This approximation is useful to find an unknown probability of success/failure by using a fairly large number of trials (for example, asking 100 people if they like a particular brand of shampoo etc).


Summary


The binomial distribution is a discrete probability distribution which describes the probability of success (or failure) of a Bernoulli experiment. A Bernoulli experiment consists of n repeated trials of the same type, each with the same probability of success (p) or failure (1-p),


and a trial can only have two outcomes (YES/NO, success/failure etc). The distribution can be approximated by the normal distribution, if a large sample is used (n>20).


Search For More Business Analysis Information

Custom Search



© 2006 - 2014 Stellar Force
Share this page






Do You Want To Understand Statistics Better?

The links below are specific questions and answers about statistics and how to use them.

Standard Deviation Formula

Regression Procedure

Regression Modeling

What is the Standard Deviation?

Mean and Standard Deviation

What Is the Value of Standard Deviation in Business?

Standard Error

Analysis of the Data