Recap and Gotta-Know’s: Probability and Statistics Section

1. Probs and Stats is a significant portion of this exam (6-9 problems, 7%).
Therefore, by knocking the rust off some formulas that are difficult to
remember how to use, you’ll be able to gain some valuable ground towards
that passing score of 60+. I will say however, that the ACTUAL exam had
several problems that were FAR EASIER than what the FE Review manual
suggests training for. Details to follow below.
2. I’ll lead off by saying, TAKE ADVANTAGE OF YOUR CALCULATOR FOR ITS
PROBS AND STATS FUNCTIONS.
a. ***I’ve posted a button-pushing word doc that covers how to find the
std deviation, and mean given a data set for many varieties of
calculators. (See Misc. notes folder in the topic review section)
b. Knowing this can turn a 4 min number crunching evolution into a 1
min calculator output.
c. I must have had 4-5 questions on simply calculating the mean,
variance, or std deviation of a data set.
d. On that note, recall that standard deviation = Sqrt(Varience)
e. Specifically useful for: mean, population std dev, and sample std dev,
combinations and permutations
3. FE Reference Equations aren’t bad- they actually explain a lot of probability
laws and concepts (instead of just listing the formula), and also DEFINE
variables for most formulas/distributions as well.
4. Combinations (order DOES NOT matter) and Permutations (order DOES
matter) are SUPER easy points to earn and I had at least one problem on both
my practice, and actual exams. USE CALCULATOR nCr ; nPr
5. Recall what “CONDITIONAL PROBABILITY” is: “What is the probability of
choosing A GIVEN B has occurred” – equation is there, just review principle.
6. KNOW the difference between population (large sample sizes) vs sample
(small sample sizes) and how their formulas change (just remember to use
the right formula).
7. Expect either a POISSON or a BINOMIAL distribution problem. Just
understand what the variables mean and plug and chug away.
8. Expect 1-2 NORMAL distribution problems. The FE Review manual goes into
other abstract distributions, but the only ones I’ve ever seen on the practice
and actual were of the NORMAL type. Recall looking up the “Z” value = (X-
mean) / STD DEV  Take that value to the table to read off probability on the
bell-curve area charts…oh yeah…remember those things? Easy points if you
can just remember this process!
9. There will probably be one question on “Hypothesis Testing” or “Linear
Regression” so try to watch a quick YouTube video or Kahn Academy on
that…sometimes difficult to understand, especially if you haven’t seen that in
a while----might be a question to guesstimate on to save time. There are
some notes in the equation sections, but they do a good job of confusing you
instead of helping.
 10. By understanding the “Complement” principle helps with a lot of the basic
probability problems i.e., “the Probability of Success = 1 – Probability of
Failure”; think coin flips, win-lose, hits or misses, etc.
11. Google BAYES THEOREM to read a couple of examples on that. Formula is on
the reference equations, but difficult concept to grasp.

*Hope this helps in your studies. Probs and Stats has too many opportunities to
score easy points on if you just spend some time doing the example problems
and following along the solutions. The formulas are all there, you’ll just need to
remember how to use them. Keep pressing on!*