Question

The number of losses experiences has P(N=0)=0.4, P(N=1)=0.3, P(N=2)=0.2, P(N=3)=0.1. Individual losses are independent and follow an exponential distribution with mean 4. Let S be the sum of the losses. Find the mean and variance of S.

          The number of losses experiences has P(N=0)=0.4, P(N=1)=0.3, P(N=2)=0.2, P(N=3)=0.1. Individual losses are independent and follow an exponential distribution with mean 4. Let S be the sum of the losses. Find the mean and variance of S.
        
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Elementary Statistics a Step by Step Approach
Elementary Statistics a Step by Step Approach
Allan G. Bluman 9th Edition
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The number of losses experiences has P(N=0)=0.4, P(N=1)=0.3, P(N=2)=0.2, P(N=3)=0.1. Individual losses are independent and follow an exponential distribution with mean 4. Let S be the sum of the losses. Find the mean and variance of S.
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00:01 Student let's discuss the following question so here we have to take a variable x this x variable follows the binomial distribution okay x variable follows the binomial distribution so first of all we have to know the number of size n number of size n which is equals to 41 and probability of success p that is equals to 0 .6.
00:30 So now we have to find a probability of failure q that is equals to 1 minus p that is 1 minus 0 .6 which is equals to 0 .4.
00:42 Okay.
00:43 So now x follows binomial n comma p that is 41 .0 .6...
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