Chapter 6

Continuous Probability
Distributions

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• Normal Probability Distribution

f (x) Normal

2
Random Variables
• A random variable is a numerical description of the
outcome of an experiment.
• Discrete Random Variable
✓ one that takes on a countable number of values
✓ e.g. Family size: 1, 2, 3, 4, …, 8
• Continuous Random Variable
✓ one whose values are not discrete, not countable
✓ e.g. time (30.1 minutes, 30.101 minutes, 30.112 minutes, ……)
• Analogy:
✓ Integers are Discrete, while Real Numbers are Continuous.
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Random Variables (RVs)

Illustration Random Variable x Type

x = Number of dependents
Family size Discrete
reported on tax return
Distance from x = Distance in miles from
Continuous
home to stores home to the store site

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Probability Density Function (pdf)
• A function f(x) is called a probability density function (over the
range a ≤ x ≤ b) if it meets the following requirements:
(1) f(x) ≥ 0 for all x between a and b, and
f(x)

area=1
a b

(2) The total area under the curve between a and b is 1.0

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 Continuous Probability Distributions
• The probability of the random variable assuming a value within some
given interval from x1 to x2 is defined to be the area under the graph of
the pdf between x1 and x2.

f (x) Normal

x
x1 x2

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Area as a Measure of Probability

• The area under the graph of f(x) and probability are identical.

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 Continuous Probability Distributions
• Because there is an infinite number of values, the probability of
each individual value is virtually 0.
• Thus, we can determine the probability of a range of values only.
• E.g. In a continuous setting, the probability the random variable of
interest, say arrival time, takes exactly 5 minutes is tiny small, hence
P(X=5) = 0.
✓ It is meaningful to talk about P(X ≤ 5) (i.e., a range of values)

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6.2 Normal Probability Distribution (p. 275)
• The normal probability distribution is the most important
distribution for describing a continuous random variable.

• It has been used in a wide variety of applications including:

• Test scores
• Heights of people
• Amounts of rainfall
• …

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Normal Probability Distribution
• Normal Probability Density Function
1 −1/2((𝑥−𝜇)/𝜎) 2
𝑓 𝑥 = 𝑒
𝜎 2𝜋
where:  = mean
 = standard deviation
 = 3.14159
e = 2.71828

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 11

Normal Probability Distribution

• Characteristics
The normal distribution is fully defined by two parameters:
its standard deviation and mean

The normal distribution is bell shaped and

symmetrical about the mean
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Normal Probability Distribution
• Characteristics
The distribution is symmetric.
The highest point on the normal curve is at the mean.

x
mean
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Normal Probability Distribution
• Characteristics
The mean can be any numerical value: negative, zero, or positive.

x
-10 0 25

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Normal Probability Distribution
• Characteristics
The standard deviation determines the width of the curve:
larger values result in wider, flatter curves.

 = 15

 = 25

x
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Normal Probability Distribution
• Characteristics
Probabilities for the normal random variable are given by areas
under the curve. The total area under the curve is 1
(.5 to the left of the mean and .5 to the right).

.5 .5
x
mean
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 X1

Shaded Area represents Probability P (X < x1)

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⚫ This area can be expressed as the integral

⚫ However, we cannot integrate the function analytically to find the probability.

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Standard Normal Probability Distribution

• Characteristics

A random variable having a normal distribution with a

mean of 0 and a standard deviation of 1 is said to have
a standard normal probability distribution.

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Standard normal (probability) distribution

0
1
1

Any normal distribution can be converted to a standard

normal distribution with simple algebra. This makes
probability calculations much easier.

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 Calculating Normal Probabilities…
We can use the following function to convert any normal random
variable (X) to a standard normal random variable (Z)

z : standard normal random variable.

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21
We standardize X by computing

22
• Cumulative
Probability
Table for
the Standard
Normal
Distribution
(p. 974-975)

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Standard Normal Probability Distribution
• Example: Pep Zone

Pep Zone sells auto parts and supplies including a popular

multi-grade 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 a replenishment order.

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Standard Normal Probability Distribution
• Example: Pep Zone
It has been determined that demand during replenishment lead-
time is normally distributed with a mean of 15 gallons and a
standard deviation of 6 gallons.
The manager would like to know the probability of a stockout
during replenishment lead-time. In other words, what is the
probability that demand during lead-time will exceed 20 gallons?

P(x > 20) = ?

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Standard Normal Probability Distribution
• Solving for the Stockout Probability (p. 975)

Area = ?? Area = 1 - ??
= ?

x
15 20
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Standard Normal Probability Distribution
• Solving for the Stockout Probability (3 steps)

Step 1: Convert x to the standard normal distribution.

z = (x - )/
= (20 - 15)/6
= .83

Step 2: Find the area under the standard normal curve

to the left of z = .83.

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Standard Normal Probability Distribution

Step 3: Compute the area under the standard normal

curve to the right of z = .83. (p. 975)

P(x > 20) = P(z>.83)

P(z > .83) = 1 – P(z < .83)
= 1- .7967
= .2033
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Standard Normal Probability Distribution
• Solving for the Stockout Probability (p. 975)
0
1
1

Area = ?? Area = 1 - ??
= ?

z
0 .83 29
• Cumulative
Probability
Table for
the Standard
Normal
Distribution
(p. 974-975)

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31
Standard Normal Probability Distribution
• Solving for the Stockout Probability (p. 975)

Area = .7967 Area = 1 - .7967

= .2033

z
0 .83

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(1) P(a < z < b) = P(a ≤ z ≤ b) =P(z ≤ b) − P(z ≤ a)
(2) P(z > a) = P(z ≥ a) = 1- P(z ≤ a)

Example:
Compute the probability: P(0 < z < 2)=?

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Example:
Compute the probability:
P(0 < z < 2)=?

Sol:
P(0 < z < 2)
= P(z < 2) - P(z < 0)
= .9772 - .5
= .4772

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End of Chapter 6
Learning Objectives
• Be able to compute probabilities using a normal probability
distribution.
• Understand the role of the standard normal distribution in
this process.

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