http://img6.imageshack.us/img6/8240/x8ox.jpg

http://img28.imageshack.us/img28/7949/prd9.jpg

Printable View

- Oct 15th 2013, 08:52 AMusagi_killerHow to find the conditional variance and CDF?
- Oct 15th 2013, 08:03 PMchiroRe: How to find the conditional variance and CDF?
Hey usagi_killer.

For clarification 1, evaluate the expectation and then use the property that Var[aX] = a^2*Var[X].

For clarification 2, you need to use the CDF result for e_it and standardize the expression so the distribution has mean 0 and variance 1.

Think of how you do this for a Normal distribution. Lets say you have X ~ N(mu,v^2). You can then say

P(X < x) = P(X - mu < x - mu) = P([X - mu]/v = (x - mu)/v = P(Z < (x - mu)/v) = P(Z < z).

Its exactly the same sort of idea. - Oct 19th 2013, 12:39 PMusagi_killerRe: How to find the conditional variance and CDF?
Thanks chiro, looks like I made things harder than it seemed haha