However, the term often implies human judgment or analysis about the probabilities of different outcomes. For a discrete random variable, the expected value is the weighted average of the possible values of the random variable, the weights being the probabilities that those values will occur.
Week #4 – Expected value
- December 9, 2013
- , 5:20 pm
The expected value of a random variable, in a simple sense, is nothing but the arithmetic mean.