Chapter 7 Intro To Risk Analysis Flashcards Preview

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Flashcards in Chapter 7 Intro To Risk Analysis Deck (14)
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1
Q

Theoretical probability

A

Probability that is based on the theoretical principles rather than an actual experience

2
Q

Empirical probability

A

A probability measure that is based on actual experience through historical data or from the observation of facts

3
Q

Probability analysis

A

A technique for forecasting events such as accidental or business losses on the assumption that they are governed by an unchanging probability distribution

4
Q

Probability distribution

A

A presentation via table chart or graph of probability estimates of a particular set of circumstances and of the probability of each possible outcome

5
Q

Central tendency

A

The single outcome that is the most representative of all possible outcomes included within a probability distribution

6
Q

Dispersion

A

The variation among values in a distribution

7
Q

Expected value

A

The weighted average of all of the possible outcomes of a probability Distribution

8
Q

Mean

A

The sum of the values in a data set divided by the number of values

9
Q

Standard deviation

A

A measure of dispersion’s between the values in a distribution and the expected value or mean of the distribution, calculated by taking the square root of the variance

10
Q

Coefficient of variation

A

A measure of dispersion calculated by dividing a distributions standard deviation by its mean

11
Q

Normal distribution

A

The probability distribution that, when graft, generate a bell shaped curve

12
Q

Trend analysis

A

And analysis that identifies patterns in pass data and then projects these patterns into the future

13
Q

Regression analysis

A

I statistical technique that is used to estimate relationships between variables

14
Q

Linear regression analysis

A

A form of regression analysis that assumes that the change in the dependent variable is constant for each unit of change in the independent variable