07 Normal Distribution
07 Normal Distribution
1
Before Starting Normal Distribution
P(8<x < 12) = ?
f (x )
1/10
P( < 12) = ?
5 12 15 x
P( < 8) = ? f (x )
1/10
5 12 15 x
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The Normal Probability Distribution
Graph of the Normal Probability Density Function
f (x )
x
3
The Normal Curve
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The Normal Curve
The total area under the curve the same as any other
probability distribution is 1.
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The Normal Probability Density Function
1 ( x )2 / 2 2
f ( x) e
2
where
= mean
= standard deviation
= 3.14159
e = 2.71828
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The Standard Normal Probability Density Function
where
=0
=1
= 3.14159
e = 2.71828
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Given any positive value for z, the table will
give us the following probability
Given positive z
z .00 .01 .02 .03 .04 .05 .06 .07 .08 .09
.0 .0000 .0040 .0080 .0120 .0160 .0199 .0239 .0279 .0319 .0359
.1 .0398 .0438 .0478 .0517 .0557 .0596 .0636 .0675 .0714 .0753
.2 .0793 .0832 .0871 .0910 .0948 .0987 .1026 .1064 .1103 .1141
.3 .1179 .1217 .1255 .1293 .1331 .1368 .1406 .1443 .1480 .1517
.4 .1554 .1591 .1628 .1664 .1700 .1736 .1772 .1808 .1844 .1879
.5 .1915 .1950 .1985 .2019 .2054 .2088 .2123 .2157 .2190 .2224
.6 .2257 .2291 .2324 .2357 .2389 .2422 .2454 .2486 .2518 .2549
.7 .2580 .2612 .2642 .2673 .2704 .2734 .2764 .2794 .2823 .2852
.8 .2881 .2910 .2939 .2967 .2995 .3023 .3051 .3078 .3106 .3133
.9 .3159 .3186 .3212 .3238 .3264 .3289 .3315 .3340 .3365 .3389
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Given any probability between 0 and .5,, the
table will give us the following positive z value
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Given the probability find z find
z .00 .01 .02 .03 .04 .05 .06 .07 .08 .09
.0 .0000 .0040 .0080 .0120 .0160 .0199 .0239 .0279 .0319 .0359
.1 .0398 .0438 .0478 .0517 .0557 .0596 .0636 .0675 .0714 .0753
.2 .0793 .0832 .0871 .0910 .0948 .0987 .1026 .1064 .1103 .1141
.3 .1179 .1217 .1255 .1293 .1331 .1368 .1406 .1443 .1480 .1517
.4 .1554 .1591 .1628 .1664 .1700 .1736 .1772 .1808 .1844 .1879
.5 .1915 .1950 .1985 .2019 .2054 .2088 .2123 .2157 .2190 .2224
.6 .2257 .2291 .2324 .2357 .2389 .2422 .2454 .2486 .2518 .2549
.7 .2580 .2612 .2642 .2673 .2704 .2734 .2764 .2794 .2823 .2852
.8 .2881 .2910 .2939 .2967 .2995 .3023 .3051 .3078 .3106 .3133
.9 .3159 .3186 .3212 .3238 .3264 .3289 .3315 .3340 .3365 .3389
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What is the z value where probability of a standard
normal variable to be greater than z is .1
10%
40%
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The End
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Standard Normal Probability
Distribution
(Z Distribution)
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Standard Normal Probability Distribution
x
z
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Example: Pep Zone
Pep Zone sells auto parts and supplies including 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 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).
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Standard Normal Distribution
z = (x - )/
= (20 - 15)/6
= .83
Area = .5
z
0 .83
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Example: Pep Zone
z .00 .01 .02 .03 .04 .05 .06 .07 .08 .09
.0 .0000 .0040 .0080 .0120 .0160 .0199 .0239 .0279 .0319 .0359
.1 .0398 .0438 .0478 .0517 .0557 .0596 .0636 .0675 .0714 .0753
.2 .0793 .0832 .0871 .0910 .0948 .0987 .1026 .1064 .1103 .1141
.3 .1179 .1217 .1255 .1293 .1331 .1368 .1406 .1443 .1480 .1517
.4 .1554 .1591 .1628 .1664 .1700 .1736 .1772 .1808 .1844 .1879
.5 .1915 .1950 .1985 .2019 .2054 .2088 .2123 .2157 .2190 .2224
.6 .2257 .2291 .2324 .2357 .2389 .2422 .2454 .2486 .2518 .2549
.7 .2580 .2612 .2642 .2673 .2704 .2734 .2764 .2794 .2823 .2852
.8 .2881 .2910 .2939 .2967 .2995 .3023 .3051 .3078 .3106 .3133
.9 .3159 .3186 .3212 .3238 .3264 .3289 .3315 .3340 .3365 .338918
The Probability of Demand Exceeding 20
Area = .2967
Area = .2033
Area = .5
z
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.
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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
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Example: Pep Zone
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.
z .00 .01 .02 .03 .04 .05 .06 .07 .08 .09
.
1.5 .4332 .4345 .4357 .4370 .4382 .4394 .4406 .4418 .4429 .4441
1.6 .4452 .4463 .4474 .4484 .4495 .4505 .4515 .4525 .4535 .4545
1.7 .4554 .4564 .4573 .4582 .4591 .4599 .4608 .4616 .4625 .4633
1.8 .4641 .4649 .4656 .4664 .4671 .4678 .4686 .4693 .4699 .4706
1.9 .4713 .4719 .4726 .4732 .4738 .4744 .4750 .4756 .4761 .4767
.
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Example: Pep Zone
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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 66 61 65 54 93
60 86 70 70 73 73
55 63 56 62 76 54
82 79 76 68 53 58
85 80 56 61 61 64
65 62 90 69 76 79
77 54 64 74 65 65
61 56 63 80 56 71
79 84
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Example: Mean and Standard Deviation
x
x i
3421
68.42
n 50
s
(x x) 2
5310.04
10.41
n 1 49
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z Values
What test mark has the property of having 10% of test
marks being less than or equal to it
10%
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z Values
We need to use standard Normal distribution in Table 1.
10%
10%
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z Values
10%
40%
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z Values
40%
z = 1.28
10%
z = - 1.28
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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 μ
z
σ
x 68.42
1.28
10.41
x 10.41( 1.28 ) 68.42 55.1
Areas
= 1.00/6
= .1667
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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-to-use approximation of binomial probabilities
where n > 20, np > 5, and n(1 - p) > 5.
Set = np
np(1 p )
Add and subtract a continuity correction factor
because a continuous distribution is being used to
approximate a discrete distribution. For example,
P(x = 10) is approximated by P(9.5 < x < 10.5).
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The Exponential Probability Distribution
where = mean
e = 2.71828
Cumulative Exponential Distribution Function
P( x x0 ) 1 e x0 /
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Example: Al’s Carwash
The time between arrivals of cars at Al’s 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.
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Example: Al’s Carwash
F (x )
.4
.3 P(x < 2) = area = .4866
.2
.1
x
1 2 3 4 5 6 7 8 9 10
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The End
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