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The 2 Parameter Pareto Continuous Distribution 7 Formulas
The 2 Parameter Pareto Continuous Distribution 7 Formulas
This is part of a short series on the common life data distributions.
The Pareto distribution is a univariate continuous distribution useful when modeling rare events as the survival function slowly decreases as compared to other life distributions. This short article focuses on 7 formulas of the Pareto Continuous Distribution also known as the Pareto distribution of the first kind (there are three kinds, apparently).
If you want to know more about fitting a set of data to a distribution, well that is in another article.
It has the essential formulas that you may find useful when answering specific questions. Knowing a distribution’s set of parameters does provide, along with the right formulas, a quick means to answer a wide range of reliability related questions.
Parameters
The location parameter, θ, which is greater than zero also sets the lower limit of time, t. It may be referred to as t-minimum.
The shape parameter, α, also greater than zero is sometimes called the Pareto index.
