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Chapter
Seven

McGraw-Hill/Irwin

2006 The McGraw-Hill Companies, Inc., All Rights Reserved.

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Chapter Seven

Continuous Probability Distributions


GOALS When you have completed this chapter, you will be able to: ONE Understand the difference between discrete and continuous distributions. TWO Compute the mean and the standard deviation for a uniform distribution. THREE Compute probabilities using the uniform distribution. FOUR List the characteristics of the normal probability distribution.

Goals

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Chapter Seven

continued

Continuous Probability Distributions


GOALS When you have completed this chapter, you will be able to:
FIVE Define and calculate z values. SIX Determine the probability an observation will lie between two points using the standard normal distribution. SEVEN Determine the probability an observation will be above or below a given value using the standard normal distribution.
Goals

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A Discrete distribution is based on random variables which can assume only clearly separated values. Discrete distributions studied include: o Binomial o Poisson.

A Continuous distribution usually results from measuring something.

Continuous distributions include: o Uniform o Normal o Others


Discrete and continuous distributions

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The Uniform distribution Is rectangular in shape Is defined by minimum and maximum values Has a mean computed as follows:
Has

P(x)

a standard deviation computed as follows:

a+b m= 2
where a and b are the minimum and maximum values

s=

(b-a)2 12
The uniform distribution

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Calculates its height as

P(x) =

1 if a < x < b and 0 elsewhere (b-a)

Calculates its area as


1 Area = height* base =(b-a) *(b-a)

The uniform distribution

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Suppose the time that you wait on the telephone for a live representative of your phone company to discuss your problem with you is uniformly distributed between 5 and 25 minutes.

What is the mean wait time?

m= a+b
2
= 5+25 = 15 2 What is the standard deviation of the wait time? (b-a)2 s= 12 (25-5)2 = 5.77 = 12
Example 1

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What is the probability of waiting more than ten minutes? The area from 10 to 25 minutes is 15 minutes. Thus:

P(10 < wait time < 25) = height*base = 1 (25-5) *15 = .75

What is the probability of waiting between 15 and 20 minutes?

The area from 15 P(15 < wait time < 20) = height*base to 20 minutes is = 1 *5 = .25 5 minutes. Thus: (25-5)
Example 2 continued

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The Normal probability distribution is bell-shaped and has a single peak at the center of the distribution. is symmetrical about the mean.
is

That is the curve gets closer and closer to the X-axis but never actually touches it.

asymptotic.
its mean,

m, to determine its location and its standard deviation, s, to determine its


Has

dispersion.

t r

i o

s2

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= 1

Characteristics of a Normal Distribution


0 . 4

Normal curve is symmetrical


0 . 3 0 . 2

Theoretically, curve extends to infinity

f ( x

. 1

. 0

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Mean, median, and mode are equal


x

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The standard normal distribution is a normal distribution with a mean of 0 and a standard deviation of 1.

It is also called the

z distribution.

A z-value is the distance between a selected value, designated X, and the population mean m, divided by the population standard deviation, s. The formula is:

X -m

The Standard Normal Probability Distribution

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X -m

= $2,200 - $2000 $200


= 1.00

The bi-monthly starting salaries of recent MBA graduates follows the normal distribution with a mean of $2,000 and a standard deviation of $200. What is the z-value for a salary of $2,200?

MBA

Example 2

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What is the z-value for $1,700?

X -m

$1,700 - $2,000 -1.50 $200

A z-value of 1 indicates that the value of $2,200 is one standard deviation above the mean of $2,000. A z-value of 1.50 indicates that $1,700 is 1.5 standard deviation below the mean of $2000.
EXAMPLE 2 continued

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About 68 percent of the area under the normal curve is within one standard deviation of the mean. m + 1s About 95 percent is within two standard deviations of the mean. m + 2s Practically all is within three standard deviations of the mean. m + 3s Areas Under the Normal
Curve

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The daily water usage per person in Providence, Rhode Island is normally distributed with a mean of 20 gallons and a standard deviation of 5 gallons. About 68 percent of those living in New Providence will use how many gallons of water? About 68% of the daily water usage will lie between 15 and 25 gallons (+ 1s ).
Example 3

295

RHODE ISLAND

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Providence Scituate Res Warwick

95 Newport

What is the probability that a person from Providence selected at random will use between 20 and 24 gallons per day?
X -m 24 - 20 0.80 5

s
X -m

20 - 20 0.00 5
EXAMPLE 4

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The area under a normal curve between a z-value of 0 and a z-value of 0.80 is 0.2881. See the following diagram

We conclude that 28.81 percent of the residents use between 20 and 24 gallons of water per day.
Example 4 continued

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What percent of the population use between 18 and 26 gallons per day?

X -m

s
X -m

26 - 20 1.20 5

18 - 20 -0.40 5
EXAMPLE 4 continued

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The area The area associated with a associated with a z-value of 0.40 is z-value of 1.20 is .1554. .3849. Adding these areas, the result is .5403.
We conclude that 54.03 percent of the residents use between 18 and 26 gallons of water per day.
EXAMPLE 4 continued

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Professor Mann has determined that the scores in his statistics course are approximately normally distributed with a mean of 72 and a standard deviation of 5. He announces to the class that the top 15 percent of the scores will earn an A. What is the lowest score a student can earn and still receive an A?
EXAMPLE 5

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To begin let X be the score that separates an A from a B. If 15 percent of the students score more than X, then 35 percent must score between the mean of 72 and X.

The z-value associated corresponding to 35 percent is about 1.04.

EXAMPLE 5 continued

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We let z equal 1.04 and solve the standard normal equation for X. The result is the score that separates students that earned an A from those that earned a B.

Those with a score of 77.2 or more earn an A.

X - 72 1.04 5 X 72 1.04(5) 72 5.2 77.2


EXAMPLE 5 continued