You are on page 1of 1

A drug company believes that the annual demand for a drug will follow a normal

random variable with a mean of 900 pounds and a standard deviation of 60 pounds. If
the company produces 1000 pounds of the drug, what is the chance (rounded to the
nearest hundredth) that it will run out of the drug? Assume that the only way to meet
the demand for the drug is to use this year's production number
Z score= (1000-900)/60= 1.66 Sd
If you remember the normal curve distribution, where mean is 900.
We need to find the area above 1.66, so that the demand will be more than 1000. ( at
1000 , it is 1.66 sd away from mean on the right side which covers 0.4515 and the
area beyond 0.4515 is ( 0.5-.04514)= .04846 ( since the question is that demand will
exceed production, we need to calculate the portion where demand will exceed on the
right hand side of the curve).