Statalist


[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]

Re: st: RE: Calculating binomial probability distribution of cumulative outcomes of independent events with differing values and probabilites


From   Wally Knox <[email protected]>
To   [email protected]
Subject   Re: st: RE: Calculating binomial probability distribution of cumulative outcomes of independent events with differing values and probabilites
Date   Sun, 11 Jan 2009 10:34:58 -0800

Hi Nick etc.

The events are independent so their individual probabilities don't total 1.0.

I am told that to obtain the likely outcome of the events to multiply their individual probabilities by their individual values and sum the results.

So,

Event	Prob	Value	Prob*Value

1		.9		12		1.08
2		.5		2		1.0
3		.2		6		1.2

I am told that the most likely outcome of all three events will be 1.08 + 1.0 + 1.2 = 3.28. But I would like to see the full distribution of outcomes by their cumulative probabilities. Can I use a monte carlo simulation setting different probabilities and values for each event?

Wally


On Jan 11, 2009, at 8:51 AM, Nick Cox wrote:

I don't get this. Probabilities of .9, .5, .2 don't add to 1.
Nor does this look like a binomial calculation to me. Nor do obvious
need Stata for problems like this, which have an analytic solution.

Your problem may be related to that solved below

. set random 1952
. gen noise = runiform()
. gen score = cond(noise < .2, 12, cond(noise < .6, 2, 6))

Nick
[email protected]

Wally Knox

I would like to calculate the probability distribution of the
cumulative outcomes of independent events each of which has
a different value and a different probability.  For instance, take
three events.  Event One has a probability of .9 and would contribute
12 to the overall outcome.  Event Two has a probability of .5 and
would contribute 2 to the overall outcome.  Event Three has a
probability of .2 and would contribute 6 to the overall outcome.  What
is a simple way in Stata to perform the calculation of the
distribution of the overall outcome values?


*
*   For searches and help try:
*   http://www.stata.com/help.cgi?search
*   http://www.stata.com/support/statalist/faq
*   http://www.ats.ucla.edu/stat/stata/

*
*   For searches and help try:
*   http://www.stata.com/help.cgi?search
*   http://www.stata.com/support/statalist/faq
*   http://www.ats.ucla.edu/stat/stata/



© Copyright 1996–2024 StataCorp LLC   |   Terms of use   |   Privacy   |   Contact us   |   What's new   |   Site index