Chapter 11: Solution 11.8

Discussion in 'SP8' started by jensen, Nov 6, 2011.

  1. jensen

    jensen Member

    Chapter 11: Solution 11.8 [2011]

    Hi

    The solution attempts to show us how to work out the skewness for a compound poisson distribution, but I don't get how the first three equations come about.

    Can someone please explain further?

    Thanks.
     
    Last edited by a moderator: Nov 8, 2011
    jensen, Nov 6, 2011
    #1
  2. Ian Senator

    Ian Senator ActEd Tutor Staff Member

    The first equation is the third moment. The formula within the integral comes is the pdf of the Pareto distribution, found two-thirds down page 14 of the Tables.

    This is messy to integrate, so instead we use the three-parameter version at the top of page 15 of the Tables. The second equation relies on the integral of a pdf being unity. In the third equation we've written one equation in the same format as the other, using a fiddle factor (the gamma parameters) to get it into the same format. Email me if you can't follow it through now (equations don't work well on forums)!
     
    Ian Senator, Nov 11, 2011
    #2

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