Financial Risk Manager Part 1
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Given the following probability mass function for a discrete random variable X, determine the CDF of X=30, that is, F(30).
X = {10, 20, 30, 40}, P(x) = x/100
Other
Community
NNikitesh
A
0.2
B
0.3
C
0.7
D
0.6
Explanation:
The cumulative distribution function (CDF) F(x) defines the probability that a random variable X takes a value less than or equal to x. For F(30):
F(30) = P(X ≤ 30) = P(X = 10) + P(X = 20) + P(X = 30) = 10/100 + 20/100 + 30/100 = 60/100 = 0.6
Therefore, the CDF at X=30 is 0.6 or 60%.
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