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Probability concepts and common probability distributions

Quantitative methods · Lesson 3 of 5

Lesson 3 of 5

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Lesson 3 of 5 · Quantitative methods

Probability concepts and common probability distributions

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Explain basic probability concepts, including random variables, mutually exclusive events, exhaustive events, independent events, and conditional probability.
Apply the addition and multiplication rules of probability and use counting techniques to determine event probabilities.
Calculate and interpret expected value, variance, standard deviation, covariance, and correlation for probability distributions.

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Calculate and interpret probabilities using common distributions, including the uniform, binomial, and normal distributions.

Explain the standard normal distribution, use z-values to determine probabilities, and describe the role of the lognormal distribution in modeling security prices.

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