So we have S=X_1+X_2+...+X_n E(S|N=n)=nE(X) var(S|N=n) = nvar(X) E(S)=E(E(S|N)) = E(NE(X))=E(N)E(E(X))=E(N)E(X) then for var(S) var(S) = E(var(S|N))+var(E(S|N)) = E(Nvar(X))+var(NE(X)) = E(N)var(X) +var(N)[E(X)]^2 How do we get that var(NE(X))=var(N)[E(X)]^2
I just realised - E(X) is a constant, so using the forumula var(aX+b) = a^2var(X) you get the result! doh!