Question: As mentioned in Section 4 5 when n is large p
As mentioned in Section 4.5, when n is large, p is small, and np ≤ 7, the Poisson probability distribution provides a good approximation to the binomial probability distribution. Since we provide exact binomial probabilities (Table II in Appendix A) for relatively small values of n, you can investigate the adequacy of the approximation for n = 25. Use Table II to find p(0), p(1), and p(2) for n = 25 and p = .05. Calculate the corresponding Poisson approximations, using λ = μ = np. These approximations are reasonably good for n as small as 25, but to use such an approximation in a practical situation we would prefer to have n ≥ 100.
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