Beta rectangular distribution
Probability density function | |||
Cumulative distribution function | |||
Parameters |
shape (real) shape (real) mixture parameter | ||
---|---|---|---|
Support | |||
CDF |
where | ||
Mean | |||
Variance | where |
In
Definition
Probability density function
If parameters of the beta distribution are α and β, and if the mixture parameter is θ, then the beta rectangular distribution has probability density function[citation needed]
where is the gamma function.
Cumulative distribution function
The cumulative distribution function is[citation needed]
where and is the
Applications
Project management
The
In PERT, restrictions on the PERT distribution parameters lead to shorthand computations for the mean and standard deviation of the beta distribution:
where a is the minimum, b is the maximum, and m is the mode or most likely value. However, the variance is seen to be a constant conditional on the range. As a result, there is no scope for expressing differing levels of uncertainty that the project manager might have about the activity time.
Eliciting the beta rectangular's certainty parameter θ allows the project manager to incorporate the rectangular distribution and increase uncertainty by specifying θ is less than 1. The above expectation formula then becomes
If the project manager assumes the beta distribution is symmetric under the standard PERT conditions then the variance is
while for the asymmetric case it is
The variance can now be increased when uncertainty is larger. However, the beta distribution may still apply depending on the project manager's judgment.
The beta rectangular has been compared to the uniform-two sided power distribution and the uniform-generalized biparabolic distribution in the context of project management. The beta rectangular exhibited larger variance and smaller kurtosis by comparison.[3]
Income distributions
The beta rectangular distribution has been compared to the elevated two-sided power distribution in fitting U.S. income data.[4] The 5-parameter elevated two-sided power distribution was found to have a better fit for some subpopulations, while the 3-parameter beta rectangular was found to have a better fit for other subpopulations.
References
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- S2CID 3648290.