Probability Distributions - I in Statistics

Recall that in our upGrad game example, we need to find out if the game would be profitable for the players or for us (i.e., the house) in the long run. The three-step process for this is as follows:

1. Find all the possible combinations.

2. Find the probability of each combination.

3. Use the probabilities to estimate the profit/loss per player.

So far, we have completed step 1 and are at step 2, i.e., we are calculating the probability of each combination. For this, we defined a random variable X, which helped us convert the outcomes of our experiment to measurable values. Now, let’s find the probability of each of these combinations.

So, we performed the experiment (i.e., played the game) 75 times and then made the frequency distribution (histogram). Now, you may be thinking, “Well, I want to try that out too.” Unfortunately, even if you do have a bag with 3 red balls and 2 blue balls, playing the game 300 times would be tedious and difficult. Well, that’s not a problem. You can simulate the whole experiment.

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