BADM220 – Chapter 7

Chapter 7 – Continuous Probability Distributions

Introduction
In this chapter, we explore continuous probability distributions which usually result from
measuring something, such as the height of kindergarten children. For continuous distributions, we
are usually interested in the percent of observations that occur within a certain range, rather than
the probability for a specific value.

The Family of Uniform Probability Distributions

I. Uniform probability distribution – the simplest distribution for a continuous random variable
that is rectangular in shape and is defined by a minimum value, a, and a maximum value, b.

A. Mean – located in the middle of the interval between the minimum and
maximum values.
Formula: 𝜇 = 𝑎+𝑏
2

B. Standard Deviation – describes the dispersion of the distribution

Formula: 𝜎 = √(𝑏−𝑎)2
12

C. Equation for the Height of the Uniform Probability Distribution:

Height = 1 if a ≤ x ≤ b, and 0 elsewhere
𝑏−𝑎

D.Steps for Finding Probability

1. Translate the question to probability notation, using an inequality.
2. Sketch the distribution and shade the area under the curve that corresponds to
the inequality.
3. Determine the height (using the formula above) and the base (the horizontal
length of the shaded area which is the distance between the two values).
4. Substitute the values of the height and base into the following formula:
Probability = Area = (height)(base)
(Multiply the values of the height and base.)
E. Example: Self-Review 7-1, page 210
Australian sheepdogs have a relatively short life. The length of their life follows a
uniform distribution between 8 and 14 years.
(a) Draw this uniform distribution. What are the height and base values? (Hint:
Look at the answer given in Appendix E. The base values are the minimum
and maximum values specified in the problem: minimum = 8 and
maximum = 14, so a = 8 and b = 14. Substitute these values into the formula
to find the height and leave in fraction form even though the book converts to
decimal. Place the values of a and b on the horizontal axis. On the
vertical axis, the only value needed is the height. Draw the left side of the
rectangle from the value of a to the height. Draw the top of the rectangle and
draw the right side of the rectangle. The bottom of the rectangle is the
horizontal axis.)

(b) Show the total area under the curve is 1.00.

(Hint: Area = (height)(base). You already have the height, 1, calculated above,
6
and the base is the distance from the minimum to the maximum values, in
other words, b – a. The area is the product (multiplication) of these two
values.)

(c) Calculate the mean and standard deviation of this distribution.

(Hint: Simply substitute the values of a and b into the formulas.)
 (d) What is the probability a particular dog lives between 10 and 14 years?
(Solution: Step 1: Translate the question to probability notation. The key
word in determining the inequality is “between”. In algebra, any inequality
stated as “between c and d” is written as c ≤ x ≤ d. The “x” represents the
variable that is being studied. In this problem x = lifespan of an Australian
sheepdog. So, the “probability a particular dog lives between 10 and 14
years” is translated as P(10 ≤ x ≤ 14).
Step 2: Sketch the distribution and shade the area under the curve that
corresponds to the inequality.

height = 1/6

8 10 14
base

Step 3: We know the height is 1/6. The base is 14 – 10 = 4.

Step 4: Substitute the values of the height and base into the formula.

(e) What is the probability a dog will live less than 9

years? (Hint: Follow the same four steps as above.)
7.3 The Family of Normal Probability Distributions
I. Characteristics
A. It is bell-shaped and has a single peak at the center of the distribution.
B. It is symmetrical about the mean.
C. The tails of the curve approach the x-axis but never touch it.
D.The location is determined by the mean, μ, and the spread is determined by the
standard deviation, σ.
E. The total area under the curve is 1.00 or 100%.
F. Below is a sketch of a Normal Probability Distribution

II. Examples: page 212-213

A. The sketch below shows the probability distributions of length of employee service in
three different plants. All have the same mean, but different standard deviations.
Notice how the standard deviation determines how spread out the curves are. The
curve with the smallest standard deviation is taller and not as spread out as the other
two curves. All three curves have the same area under them.

Equal Means and Different

Standard Deviations
B. The following chart shows the distribution of box weights of three different
cereals. All of the distributions have the same standard deviation, but have different
means. Notice that all three curves are the same size (same height and spread out
the same), but are located at different places along the horizontal axis.

Different Means and Equal Standard Deviations

C. The distribution of tensile strengths, measured in pounds per square inch (psi), for
three types of cables are shown in the following chart. The means and the standard
deviations are different for all three. Notice that all three have different heights and
are spread out differently as well as all being located at different places along the
horizontal axis.

Different Means and

Standard Deviations
The Standard Normal Probability Distribution
I. Because there is an infinite number of normal distributions and normal curves, it is impossible
to provide probability tables. Fortunately, one member of the family can be used to determine
the probabilities for all normal probability distributions. It is called the standard normal
probability distribution.
II. The standard normal probability distribution is unique and has a mean of 0 and standard
deviation of 1. We can convert any normal distribution (denoted as x values) to the standard
normal distribution (denoted as z values).
A. z value or z score – the signed distance between a selected value, designated x, from
the mean, measured in units of the standard deviation
Formula: 𝑧 = 𝑥− 𝜇
𝜎
B. Example: Self-Review 7-2, page 215 (Answers in Appendix E)
A recent national survey concluded that the typical person consumes 48 ounces
of water per day. Assume daily water consumption follows a normal probability
distribution with a standard deviation of 12.8 ounces.
(a) What is the z value for a person who consumes 64 ounces of water per day
Based on this z value, how does this person compare to the national average?

(b) What is the z value for a person who consumes 32 ounces of water per day?
Based on this z value, how does this person compare to the national average?

C. The Empirical Rule (from Chapter 3, page 79)

1. About 68% of the area under the normal curve is within one standard deviation
of the mean: between μ - 1σ and μ + 1σ
2. About 95% of the area under the normal curve is within two standard
deviations of the mean: between μ - 2σ and μ + 2σ
3. Practically all of the area under the normal curve is within three standard
deviations of the mean: between μ - 3σ and μ + 3σ

Notice how the scale of x is converted to/equivalent to the scale of z.

D. Example: Self-Review 7-3, page 217
The distribution of the annual incomes of a group of middle-management
employees at Compton Plastics approximates a normal distribution with a mean of
$47,200 and a standard deviation of $800.
(a) About 68 percent of the incomes lie between what two amounts?
(Hint: Develop the horizontal axis of the Empirical Rule using the given
values of the mean and standard deviation.

(b) About 95 percent of the incomes lie between what two amounts?

(c) Virtually all of the incomes lie between what two amounts?

(d) What are the median and modal incomes?

(e) Is the distribution of incomes symmetrical?

E. Finding Areas Under the Normal

Curve Procedure/Steps:
1. Translate the question into a probability using an inequality. Let x represent
the continuous random variable.
2. Convert each value of x in the inequality into z values.
3. Rewrite the probability using the z values.
4. Sketch the area under the curve and use table B.3 Areas under the
Normal Curve, p. 732 to find the area according to the following:
a. To find the area between 0 and z (or 0 and –z), look up the probability
directly in the table.
b. To find the area beyond z (right tail), or beyond –z (left tail), locate the
probability of z in the table and subtract that probability from .5000.
c. To find the area between two points on different sides of the mean,
locate each probability in the table and add them.
d. To find the area between two points on the same side of the mean,
locate each probability in the table and subtract the smaller probability
from the larger.
e. To find the area from –z to the right or from +z to the left, locate the
probability in the table and add 0.5.
F. Examples:
1. Self-Review 7-4, page 221
The temperature of coffee sold at the Coffee Bean Café follows the normal probability
distribution, with a mean of 150 degrees. The standard deviation of this distribution is 5
degrees.
(a) What is probability that the coffee temperature is between 150 degrees and
154 degrees?
Procedure/Steps:
1. Translate the question into a probability using an inequality. Let x represent
the continuous random variable.
P(150 ≤ x ≤ 154)

2. Convert each value of x in the inequality into z values.

z = 150 – 150 = 0 and z = 154 – 150 = 0.80
5 5

3. Rewrite the probability using the z values.

P(0 ≤ z ≤ 0.80)

4. Sketch the area under the curve and use table B.3 Areas under the
Normal Curve, p. 732 to find the area.

0 0.80

Because the area is between 0 and z, look up the area from the table.
So, P(0 ≤ z ≤ 0.80) = 0.2881.
(b) What is the probability that the coffee temperature is more than 164
degrees? Procedure/Steps:
1. P(x > 164)

2. z = 164 – 150 = 2.80

5

3. P(z > 2.80)

4.

2.80

Since the area is in the right tail, subtract the area from the table from .5000.
So, P(z > 2.80) = .5000 - .4974 = .0026
 2. Self-Review 7-5, page 223
Refer to Self-Review 7-4. The temperature of coffee sold at the Coffee Bean Café
follows the normal probability distribution with a mean of 150 degrees. The standard
deviation of the distribution is 5 degrees.
(a) What is the probability the coffee temperature is between 146 degrees and
156 degrees?

(Follow the four step procedure of the previous example.)

(b)What is the probability the coffee temperature is more than 156 but less than
162 degrees?

(Follow the four step procedure of the previous example.)

G. Inverse Standard Normal Distribution – reverse the process to find the z score
associated with a probability/area and then find x.
1. Example: p. 224-225
Layton Tire and Rubber Company wishes to set a minimum mileage guarantee
on its new MX100 tire. Tests reveal the mean mileage is 67,900 with a standard
deviation of 2,050 miles and that the distribution of miles follows the normal
probability distribution. Layton wants to set the minimum guaranteed mileage so that no
more than 4% of the tires will have to be replaced. What minimum guaranteed mileage
should Layton announce?

a.Sketch the area under the curve and find the closest value in the body
of the table. The closest value to .4600 is .4599.
b. Read the z value corresponding to the closest area. The z-value is 1.75,
but the area is to the left of the mean, so z is actually -1.75.
c. Calculate x using the formula: 𝑥 = 𝑧𝜎 + 𝜇.

So, Layton can advertise that it will replace for free any tire that wears
before it reaches 64,312 miles, and the company will know that only 4%
of the tires will be replaced under this plan.

2. Example: Self-Review 7-6, page 226

An analysis of the final test scores for Introduction to Business reveals the scores
follow the normal probability distribution. The mean of the distribution is 75 and the
standard deviation is 8. The professor wants to award an A to students whose score is in
the highest 10 percent. What is the dividing point for those students who earn an A and
those earning a B?
The Normal Approximation to the Binomial
I. Use the normal distribution as a substitute for the binomial distribution for large values of n
because as n increases, a binomial distribution gets closer and closer to a normal distribution.
A. Example (From pages 227 – 230, below “Continuity Correction Factor”): The
management of the Santoni Pizza Restaurant found that 70 percent of its new customers
return for another meal. For a week in which 80 new customers dined at Santoni’s, what
is the probability that 60 or more will return for another meal?
1. The binomial conditions are met.
2. To find the probability that 60 or more will return for another meal, we would
have to use the binomial formula to find P(60), P(61), P(62), …, P(80) and
then sum the probabilities.
3. It is found that the probability of any number of customers less than 43 or
more than 68 returning is less than 0.001. We can assume these probabilities
are 0.000.
4. The chart below shows the probability distribution and its similarity to the
normal distribution.

B. Continuity Correction Factor – Because each bar in the binomial probability

distribution is centered at the values of x, the continuity correction factor is necessary
to approximate the discrete distribution with a continuous distribution. In a
continuous distribution, the area begins or ends at the edges of the bars which are the
midpoints between the discrete values. So, the value .5 is subtracted or added,
depending on the question, to the selected value of x as follows:
1. For P(x ≥ ), subtract 0.5.
2. For P(x > ), add 0.5.
3. For P(x ≤ ), add 0.5.
4. For P( x < ), subtract 0.5.

C. Solution to the above question.

1. Apply the continuity correction factor.
P(x ≥ 60) becomes P(x ≥ 59.5)

2. Find the mean and standard deviation of the binomial distribution.

Mean: 𝜇 = 𝑛𝜋

Standard Deviation: 𝜎 = √𝑛𝜋(1 − 𝜋)

 3. (Follow steps 2 – 4 of the four step process.) Calculate the z value
corresponding to the corrected value of x.

4. Rewrite the probability using the z value.

5. Sketch the area under the normal curve and use Table B.3 to find the area.

D. Example: Self-Review 7-7, page 230

A study by Great Southern Home insurance revealed that none of the stolen goods were
recovered by the homeowners in 80% of reported thefts.
(a) During a period in which 200 thefts occurred, what is the probability that no stolen
goods were recovered in 170 or more of the robberies?

(b) During a period in which 200 thefts occurred, what is the probability that no
stolen goods were recovered in 150 or more robberies?

(Skip section on The Family of Exponential Distributions)