Lyka Mariño Jan Mark Recto Joshua Diño

Continuous Random Distribution

History of Normal Distribution • The normal probability

The normal distribution was first
discovered by De Moivre (English
Mathematician) in 1733 as limiting case
of binomial distribution. Later it was
applied in natural and social science by
Laplace (French Mathematician) in
1777. The normal distribution is also
known as Gaussian distribution in honor
of Karl Friedrich Gauss (1809).
Types of CRD
distribution is the most important
distribution for describing a
continuous random variable.
• It is widely used in statistical
inference
• It has been used in a wide variety
of applications
a) Heights of people
b) Scientific measurements
c) Test scores
d) Amounts of rainfall

One of the most important differences

is that we now consider a probability
Normal Probability Density Function
density, rather than a value of the
probability per se 1 2 2
f (x)  e ( x   ) /2
Uniform Normal
 2
f Probability f Probabil
( Distribu ity
Distribu
x tion ( tion Condition of Normal Distribution
x
) x 1. Normal distribution is a limiting
x
f Probability )
Exponential form of the binomial distribution
under the following conditions. a.
Distribut n, the number of trials is
indefinitely large ie., 𝑛 → ∞ and
( ion b. Neither p nor q is very small.
x
x 2. Normal distribution can also be
What is CRD?) obtained as a limiting form of
Poisson distribution with
The probability of the random variable parameter 𝑚 → ∞
assuming a value within some given
interval from x1 to x2 is defined to be the
area under the graph of the probability
density function between x1 and x2.
Lyka Mariño Jan Mark Recto
3. Constants of normal distribution
are mean = m, variation = σ2 ,
Standard deviation = s
Normal Probability Curve
The curve representing the normal
distribution is called the normal
probability curve. The curve is
symmetrical about the mean (m), bell-
shaped and the two tails on the right
and left sides of the mean extends to
the infinity. The shape of the curve is
shown in the following figure.
f
(
x
x
)
Characteristics
1. The distribution is symmetric; its
skewness measure is zero.
2. The entire family of normal
probability distributions is defined
by its mean m and its standard
deviation s .
3. The highest point on the normal
curve is at the mean, which is
also the median and mode.
4. The mean can be any numerical
value: negative, zero, or
positive.
5. The standard deviation
determines the width of the
curve: larger values result in
wider, flatter curves.
6. Probabilities for the normal
random variable are given by
areas under the curve. The total
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area under the curve is 1 (.5 to
the left of the mean and .5 to the
right).
Empirical Rule
• 68.26% of all observations lie
within 1 standard deviation of the
mean
• 95.44% of all observations lie
within 2 standard deviations of
the mean
• 99.72% of all observations lie
within 3 standard deviations of
the mean
Standard Normal Probability
Distribution
• 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.
• The letter z is used to
designate the standard normal
random variable.
• Converting to the Standard
Normal Distribution:
x
z

Lyka Mariño Jan Mark Recto Joshua Diño

We can think of z as a
measure of the number of
standard deviations x is
from m.
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 an order. 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 If the manager of Pep Zone wants
gallons. the probability of a stockout to be
The manager would like to know no more than .05, what should the
the probability of a stockout, P(x > 20) reorder point be?
(Demand exceeding 20 gallons)
Solving for the Stockout Probability

Step 1: Convert x to the standard

normal distribution.

= (20 - 15)/6

=0.83
Step 2: Find the area under the
standard normal curve to the left of
z = .83.
Step 3: Compute the area under
the standard normal curve to the
right of z = .83.
Step 1: Find the z-value that cuts
off an area of .05 in the right tail of
the standard normal distribution.
We look up the
complement of the tail area
(1 - .05 = .95)
Step 2: Convert z.05 to the
corresponding value of x.
Lyka Mariño Jan Mark Recto Joshua Diño

A reorder point of 25 gallons will

place the probability of a stockout
during leadtime at (slightly less
than) .05. Example 2:

By raising the reorder point from Students of a class were given an

20 gallons to 25 gallons on hand, aptitude test. Their marks were found to
the probability of a stockout be normally distributed with mean 60
decreases from about .20 to .05. and standard deviation 5. What
percentage of students scored.
This is a significant decrease in
the chance that Pep Zone will be out i. More than 60 marks
of stock and unable to meet
acustomer’s desire to make a ii. Less than 56 marks
purchase.
iii. Between 45 and 65 marks
Example 1:
Solution: Given that mean = m = 60 and
Given a normal distribution with m = 50 standard
and s = 8, find the probability that x
assumes a value between 42 and 64. deviation = s = 5

Solution: The standard normal variate, z = (x -

Given that m = 50 and s = 8 m)/s
The standard normal variate, z = (x -
m)/s If x = 60, z =(60−60)/5=0

If x = 42, z = (42 - 50)/8 = -1 P(x > 60) = P(z > 0)

If x = 64, z = (64 -50)/8 = 1.74
= P(0 < z < ∞ )
P(42 < x < 64) = P(-1 < z <1.75)
= P(-1< z < 0) + P(0 < z <1.95) = 0.5
= P(0<z<1) + P (0 < z <1.75)
(by symmetry)
= 0.3413 +0 .4599 (from the table) Hence the percentage of students
= 0 .8012 scored more than 60 marks is 0.5×100 =
50 %

The standard normal variate,

Lyka Mariño Jan Mark Recto Joshua Diño

z = (x - m)/s
If x = 56, z =(56−60)/5= -0.8

P(x < 56) = P(z < -0.8)

= P(- ∞ < z < 0) – P(-0.8 < z < 0)
(by symmetry)
= P(0 < z < ∞) – P(0 < z < 0.8)
= 0.5 - 0.2881 (from the table)
= 0.2119

Hence the percentage of students score

less than 56 marks is 0.2119×100 =
21.19 %