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/
