Normal Distribution

Before Starting Normal Distribution

P(8<x < 12) = ?
P( < 12) = ?

P( < 8) = ?

f (x )
1/10
5

12

15

12

15

f (x )
1/10

P(8<x < 12) = .7-.3 = .4

2

The Normal Probability Distribution

Graph of the Normal Probability Density

Function
f (x )

x
3

The Normal Curve

The shape of the normal curve is often

illustrated as a bell-shaped curve.

The highest point on the normal curve is at the

mean of the distribution.

The normal curve is symmetric.

The standard deviation determines the width

of the curve.
4

The Normal Curve

The total area under the curve the same as

any other probability distribution is 1.

The probability of the normal random variable

assuming a specific value the same as any
other continuous probability distribution is 0.

Probabilities for the normal random variable

are given by areas under the curve.

The Normal Probability Density Function

1
( x )2 / 2 2
f ( x)
e
2
where

= mean
= standard deviation
= 3.14159
e = 2.71828
6

The Standard Normal Probability Density

Function

1
( x )2 / 2 2
f ( x)
e
2
where

=0
= 1
= 3.14159
e = 2.71828
7

Given any positive value for z, the table

will give us the following probability
The table will give this
probability

Given positive z

The probability that we find using

the table is the probability of having
a standard normal variable between
0 and the given positive z.
8

Given z find the probability

Given any probability between 0

and .5,, the table will give us the
following positive z value
Given this probability
between 0 and .5

The table will give us

this positive z

10

Given the probability find z find

11

What is the z value where probability of a

standard normal variable to be greater than z
is .1
10%

40%

12

The End

13

Standard Normal Probability

Distribution
(Z Distribution)

14

Standard Normal Probability Distribution

A random variable that has a normal distribution

with a mean of zero and a standard deviation of
one is said to have a standard normal
probability distribution.
The letter z is commonly used to designate this
normal random variable.
The following expression convert any Normal
Distribution into the Standard Normal Distribution

x
z

15

Example: Pep Zone

Pep Zone sells auto parts and supplies including multigrade motor oil. When the stock of this oil drops to
20 gallons, a replenishment order is placed.
The store manager is concerned that sales are being
lost due to stockouts while waiting for an order.
It has been determined that leadtime demand is
normally distributed with a mean of 15 gallons and a
standard deviation of 6 gallons.
In Summary; we have a N (15, 6): A normal
random
variable with mean of 15 and std of 6.
The manager would like to know the probability of a
stockout, P(x > 20).
16

Standard Normal Distribution

z = (x - )/
= (20 - 15)/6
= .83

Area = .5
0 .83

z
17

Example: Pep Zone

18

The Probability of Demand Exceeding 20

Area = .2967
Area = .2033
Area = .5
0 .83

The Standard Normal table shows an area of .

2967 for the region between the z = 0 line and
the z = .83 line above. The shaded tail area
is .5 - .2967 = .2033. The probability of a
stockout is .2033.

19

Example: Pep Zone

If the manager of Pep Zone wants the probability of a
stockout to be no more than .05, what should the
reorder point be?

Area = .05
Area = .5Area = .45
Let z.05 represent the z value
tail area of .
0 cutting zthe
.05
05.

20

Example: Pep Zone

z
.

Using the Standard Normal Probability Table

We now look-up the .4500 area in the Standard
Normal Probability table to find the
corresponding z.05 value.
z.05 = 1.645 is a
reasonable
estimate.
.00 .01 .02
.03 .04 .05 .06 .07 .08 .09

1.5
1.6

.4332
.4452

.4345
.4463

.4357
.4474

.4370
.4484

.4382
.4495

.4394
.4505

.4406
.4515

.4418
.4525

.4429
.4535

.4441
.4545

1.7
1.8

.4554
.4641

.4564
.4649

.4573
.4656

.4582
.4664

.4591
.4671

.4599
.4678

.4608
.4686

.4616
.4693

.4625
.4699

.4633
.4706

1.9 .4713 .4719 .4726 .4732 .4738 .4744 .4750 .4756 .4761 .4767
.
21

Example: Pep Zone

The corresponding value of x is given by
x = + z.05
= 15 + 1.645(6)
= 24.87
A reorder point of 24.87 gallons will place the
probability of a stockout during leadtime at .
05.
Perhaps Pep Zone should set the reorder point
at 25 gallons to keep the probability under .05.

22

Example: Aptitude Test

A firm has assumed that the distribution of the aptitude test of
people applying for a job in this firm is normal.
The following sample is available.
71
93
60
73
55
54
82
58
85
64
65

66

61

65

54

86

70

70

73

63

56

62

76

79

76

68

53

80

56

61

61

62

90

69

76

23

Example: Mean and Standard Deviation

We first need to estimate mean and standard
deviation

3421

68.42
50

2
(
x

x
)

n 1

5310.04

10.41
49

24

z Values
What test mark has the property of having 10% of
test marks being less than or equal to it
To answer this question, we should first answer
the following
What is the standard normal value (z value), such
that 10% of z values are less than or equal to
it?

10%
25

z Values
We need to use standard Normal distribution in
Table 1.

10%

10%
26

z Values

10%

40%

27

z Values
40%

z = 1.28
10%

z = - 1.28
28

z Values and x Values

The standard normal value (z value), such that 10% of z
values are less than or equal to it is z = -1.28
To transform this standard normal value to a similar value
in our example, we use the following relationship

x
z

x 68.42
1.28
10.41
x 10.41( 1.28 ) 68.42 55.1
The normal value of test marks such that 10% of random
29
variables are less than it is 55.1.

z Values and x Values

Following the same procedure, we could find z values for
cases where 20%, 30%, 40%, of random variables are
less than these values. Following the same procedure,
we could transform z values into x values.

x
z

Lower 10%
Lower 20%
Lower 30%
Lower 40%
Lower 50%
Lower 60%

-1.28
-.84
-.52
-.25
0
.25

55.1
59.68
63.01
65.82
68.42
71.02
30

Example : Victor Computers

Victor Computers manufactures and sells a
general purpose microcomputer. As part of a study
to evaluate sales personnel, management wants to
determine if the annual sales volume (number of
units sold by a salesperson) follows a normal
probability distribution.
A simple random sample of 30 of the salespeople
was taken and their numbers of units sold are below.
33 43 44 45 52 52 56 58 63 64
64 65 66 68 70 72 73 73 74 75
83 84 85 86 91 92 94 98 102 105
(mean = 71, standard deviation = 18.54)
Partition this Normal distribution into 6 equal probability
parts
31

Example : Victor Computers

Areas
= 1.00/6
= .1667
53.02 71 88.98 = 71 + .97(18.54)
63.03 78.97
32

The End

33

Normal Approximation
of Binomial Probabilities

When the number of trials, n, becomes large, evaluating

the binomial probability function by hand or with a
calculator is difficult.
The normal probability distribution provides an easy-touse approximation of binomial probabilities where n >
20, np > 5, and n(1 - p) > 5.
Set
= np
Add and subtract a continuity correction factor because a
isnpbeing
(1 pused
)
continuous distribution
to approximate a
discrete distribution. For example,
P(x = 10) is approximated by P(9.5 < x < 10.5).

34

The Exponential Probability Distribution

Exponential Probability Density Function

1 x /
f ( x) e

for x > 0, > 0

= mean
e = 2.71828
Cumulative Exponential Distribution Function
where

P( x x0 ) 1 e x0 /
where

x0 = some specific value of x

35

Example: Als Carwash

The time between arrivals of cars at Als
Carwash
follows an exponential probability distribution
with a
mean time between arrivals of 3 minutes. Al
would like
to know the probability that the time between two
successive arrivals will be 2 minutes or less.
P(x < 2) = 1 - 2.71828-2/3 = 1 - .5134 = .4866

36

Example: Als Carwash

Graph of the Probability Density Function

F (x )
.4
.3

P(x < 2) = area = .4866

.2
.1
1

5 6

x
9 10
37

The End

38