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Assignment # 1 - Econometric

1. Permutation refers to arrangements that consider order, while combination refers to selections that do not consider order. 2. There are more permutations than combinations because permutations account for all possible orderings, while combinations only consider the sets selected without order. 3. The number of permutations is calculated as nPr = n!/(n-r)!, while the number of combinations is calculated as nCr = n!/(n-r)!r!, resulting in permutations having a larger value.

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32 views

Assignment # 1 - Econometric

1. Permutation refers to arrangements that consider order, while combination refers to selections that do not consider order. 2. There are more permutations than combinations because permutations account for all possible orderings, while combinations only consider the sets selected without order. 3. The number of permutations is calculated as nPr = n!/(n-r)!, while the number of combinations is calculated as nCr = n!/(n-r)!r!, resulting in permutations having a larger value.

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21august
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Assignment # 1

Econometrics – Combination & Permutation

- 17156014
Probability:

Probability is the numeric measure of likelihood that event will occur. In probability the degree of
occurrence of event can be estimated through scales.

Scales of Probability:

The scale of probability is either 0 or 1. If the probability of event calculated as 0 it means no


happening of event and if the probability is 1 then the likelihood of event is 100 that it will occur.

Courting methods:

Following are the counting methods to count the experimental outcome so that probability of event.

1. Multiple Experiments Methods


2. Combination
3. Permutation

Combination & permutation according to Authors

Author 1: According to Marceles Fernandes (statistics for Business & Economics)

Permutation: Permutation in combinatorics for which we from sequences of k different elements from
a set of n elements. This means that we have n options for the first element of the sequence, but then n
– 2 options for the second element and so on until we have only n – k + 1 options for the last element
of the sequence. It thus follows that we have n! / (n – k)!.

Combination: this is a nation that only differs from permutation in that ordering does not matter. This
means that we just wish to know how many subsets of k elements we can construct out of a set of n
elements.

This suggests that, in general, the number of combinations is inferior to the number of permutations
because one must count only one of the sequences that employ the same elements but with a different
ordering. In view that there are n! /(n – r)! Permutations of k out of n elements and k ways to choose
the ordering of these k elements, the number of possible combinations of k out of n elements is
Author 2: According to Ronald M. Weiers (Introduction to Business statistics)

Combination: Combinations consider only the possible sets of objects, regardless of the order in
which the members of the set are arranged.

Permutation: Permutations refer to the number of different ways in which objects can be arranged in
order. In a permutation, each item can appear only once, and each order of the items’ arrangement
constitutes a separate permutation.

This might seem like a rather large number of possibilities for just 6 books on a 4-book shelf, but each
different order of arrangement is regarded as a different permutation. As these examples suggest, for
given values of n and r, the number of permutations will always be greater than the number of
combinations. This is because there will be r! Permutations for every possible combination.

Author 3: According to Muhammad EL Taha (Introduction to Business Statistics)

Permutations: (Ordered arrangements) The number of ways of ordering n distinct objects taken r at a
time (order is important) is given by n! (n − r)! = n(n − 1)(n − 2)···(n − r + 1) (which is equal to n!
(n−r)!). Combinations: For r ≤ n, we define n r = n! (n − r)!r! and say that n r represents the number of
possible combinations of n objects taken r at a time (with no regard to order).

Author 4: According to Prasanna Sahoo (Probability & Mathematical Statistics)

Permutation is nPr represents the number of ways r positions can be filled from n objects. Each of the
nPr arrangements is called a permutation of n objects taken r at a time.

Combination: In permutation, order is important. But in many problems the order of selection is not
important and interest centers only on the set of r objects. Each of the n r unordered subsets is called a
combination of n objects taken r at a time.

Author 5: According to S.K. Sinha (Introduction to Statistical Mechanics)

Permutation is the number of ways in a set or number of things can be put in an order or arranged,
combination refers to the numbers of ways in which a group of things can be chosen from a larger
group without regard to their arrangement.

Author 6: According to Anderson, Sweeney, William (Statistics for Business and Economics)
The counting rule for permutations closely relates to the one for combinations; however, an experiment
results in more permutations than combinations for the same number of objects because every selection
of n objects can be ordered in n! different ways.

Author 7: Paul Newbold University of Nottingham


William L. Carlson St. Olaf College
Betty M. Thorne Stetson University, (Statistics for Business and Economics, 8th Edition)
The total number of permutations of x objects chosen from n, Pn x, is the number of possible
arrangements when x objects are to be selected from a total of n and arranged in order.
In combinations we are interested in the number of different ways that x objects can be selected from n
(where no object may be chosen more than once) but order is not important. The number of
combinations, Cn x, of x objects chosen from n is the number of possible selections that can be made.

Author 8: Ronald E. Walpole


Raymond H. Myers
Sharon L. Myers
Keying E. Ye (Probability & Statistics)
Permutation: Permutation is an arrangement of all or parts of a set of objects in all possible order
whereas combination is selection of objects without order.

Conclusion why Permutation is greater than Combination:

Combination Permutation
Group is selected for experimental outcomes Overall list or population is selected
Order repeated ( differently) No repetition (order repeated once)
Multiplication of Sample size in dominator Every time different values/elements used so
makes outcome value smaller the outcome is vary every time and is greater
Un ordered Ordered

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