What are i.i.d. random variables?

How would you go about explaining i.i.d to non techncial people?

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I think this question is really to soft for the forum but I won't downvote it though – TheBridge Feb 7 '11 at 16:10
I agree with @TheBridge; I thought this was off-topic when I saw it. – Shane Feb 7 '11 at 22:22

migrated from quant.stackexchange.comOct 21 '11 at 18:42

It means "Independent and identically distributed".

A good example is a succession of throws of a fair coin: The coin has no memory, so all the trows are "independent".

And every throw is 50:50 (heads:tails), so the coin is and stays fair - the distribution from which every throw is drawn, so to speak, is and stays the same: "identically distributed".

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I wonder if the coin toss example would falsely give the impression that every event must be equiprobable... – Michael McGowan Oct 21 '11 at 18:57
So, is it not necessary that the IID random variables should be equi-probable? if they are not equiprobable then how can the "identically distributed" be explained? Thanks a lot in advance... – Nalini Jan 27 at 20:48
@Nalini "equi-probable" is not a synonym for "identically distributed." If $x$ and $y$ are i.i.d., this means they are taken from the same distribution, not that all values in that distribution are equally likely (think the normal distribution). $x$ and $y$ would have the same expected value, though. – Jason Morgan Jan 27 at 21:07