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Basic Concepts of Probability Theory

  • Jürgen FrankeEmail author
  • Wolfgang Karl Härdle
  • Christian Matthias Hafner
Chapter
Part of the Universitext book series (UTX)

Abstract

Thanks to Newton’s laws, dropping a stone from a height of 10 m, the point of time of its impact on the ground is known before executing the experiment. Quantities in complex systems (such as stock prices at a certain date, daily maximum temperature at a certain place) are, however, not deterministically predictable, although it is known which values are more likely to occur than others. Contrary to the falling stone, data which cannot be described successfully by deterministic mechanism, can be modelled by random variables.

Keywords

Conditional Expectation Stock Prex Daily Maximum Temperature Discrete Random Variable Continuous Random Variable 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer-Verlag Berlin Heidelberg 2011

Authors and Affiliations

  • Jürgen Franke
    • 1
    Email author
  • Wolfgang Karl Härdle
    • 2
    • 3
  • Christian Matthias Hafner
    • 4
  1. 1.FB MathematikTU KaiserslauternKaiserslauternGermany
  2. 2.Ladislaus von Bortkiewicz Chair of Statistics C.A.S.E. Centre for Applied Statistics and Economics School of Business and EconomicsHumboldt-Universität zu BerlinBerlinGermany
  3. 3.Graduate Institute of StatisticsNational Central UniversityJhongliTaiwan
  4. 4.Inst. StatistiqueUniversité Catholique de LouvainLeuven-la-NeuveBelgium

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