SMQ27103/EQT271

(WEEK 7)
CHAPTER 2 :
NORMAL PROBABILITY
DISTRIBUTION

SEM 2 2021,2022
OUTLINE CHAPTER 2
2.1 Introduction to Probability
2.2 Basic Concepts of Probability
2.3 Probability Distributions
WEEK 4
2.4 Discrete Probability Distributions
Binomial Probability Distribution
Poisson Probability Distribution
Poisson Approximation of Binomial Distribution WEEKPart
52
2.5 Continuous Probability Distribution
Normal Probability Distribution
Standard Normal Probability Distribution WEEK
Part 7

Normal Approximation of Binomial and Poisson Distribution

 WEEK 7
CONTINUOUS PROBABILITY DISTRIBUTION
- NORMAL PROBABILITY DISTRIBUTION
- NORMAL APPROXIMATION OF BINOMIAL AND POISSON DISTRIBUTION

Learning outcomes:
2.6 Able to apply normal & standard normal probability distributions.
2.7 Able to apply normal approximation of Binomial and Poisson
probability.

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Probability
Distribution

Normal
Approximation of
Continuous Binomial and
Probability
Poisson Distribution
Distribution

1) Introduction
Normal Distribution/ 2) MCT and MD of distribution
Standard Normal 3) Calculate the probability
Distribution - Using cumulative table
- Using Excel

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Introduction

❑ If a continuous random variable X has probability distribution with a symmetric

or bell-shaped graph, then the distribution of the random variable is called a
normal distribution.

❑ The graph is called a normal distribution curve.

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A random variable X having a normal distribution with mean, 𝜇 and
standard deviation, 𝜎 can be written as 𝑋 ∼ 𝑁 (𝑚𝑒𝑎𝑛, 𝑣𝑎𝑟𝑖𝑎𝑛𝑐𝑒)

𝑿 ∼ 𝑵 (𝝁, 𝝈𝟐 )
MCT and MD

Mean of 𝑋: ​𝐸 (𝑋) = 𝜇
Variance of 𝑋: 𝑉𝑎𝑟(𝑋) = 𝜎 2
Standard deviation of 𝑋: Var(𝑋) = 𝜎

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Examples of normal distribution questions.

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 Properties of normal distributions
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● Curve is ‘Bell Shaped’
● Symmetrical f(X)

● Mean, Median and Mode are Equal

● Unimodal (only 1 mode) σ
● Location is determined by the mean, μ
μ
● Spread is determined by the standard deviation, σ
● The random variable has an infinite theoretical range: Mean = Median = Mode
+  to − 
● Total area under the normal distribution curve is equal
to 1 or 100%.

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 Shapes of normal distributions
11

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➢ The normal distribution with parameters  = 0 and  2 = 1

is called a standard normal distribution.

➢ A random variable that has a standard normal distribution is called a

standard normal random variable and will be denoted by

Z ~ N (0,1)

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X −
Z=

1030 − 1010
Z= =1
20

 = 1010
 = 20

𝑋 Z

𝑿 ∼ 𝑵 (𝝁, 𝝈𝟐 ) Z ~ N (0,1)
SEM 2 2021,2022
https://www.mathsisfun.com/data/standard-normal-distribution.html
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Probability = Area under the curve

Total area =1

0 .5 0 .5
 =0 Z

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Calculate probability using table

1. Area under the standard normal curve (Find probability)

Area

Z Given

2. Upper tail probabilities (Find 𝑍𝛼 )

Area/probability is given

SEM 2 2021,2022
Z
 1. Area under the standard normal curve
(Find probability) 16

1. P(0  Z  0.24) = 0.0948

2. P(0  Z  1.07) = 0.3577

SEM 2 2021,2022
 EXAMPLE 1 17
Determine the probability or area for the portions of the
normal distribution described.
a) P( Z  0.03)

b) P( Z  −1.03)

c) P(−0.51  Z  0.02)
Ans:
a) 0.488
b) 0.1515
c) 0.203
SOLUTION
18

𝒂)𝑷(𝒁 ≥ 𝟎. 𝟎𝟑)

𝒃)𝑷(𝒁 < −𝟏. 𝟎𝟑)

𝒄)𝑷(−𝟎. 𝟓𝟏 ≤ 𝒁 ≤ 𝟎. 𝟎𝟐)
Ans:
a) 0.488
b) 0.1515
c) 0.203
 2. Upper tail probabilities (Find 𝑍𝛼 )
19

1. P( Z  Z ) = 0.031, Z = 1.8663

2. P( Z  Z ) = 0.07, Z = 1.4758

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 EXAMPLE 2 20

Determine Z such that

a) P( Z  Z ) = 0.25

b) P( Z  Z ) = 0.25

c) P( Z  Z ) = 0.983
Ans:
a) 0.6745
b) -0.6745
d) P( Z  Z ) = 0.983 c) -2.1201
d) 2.1201
SOLUTION
21
Determine 𝒁𝜶 such that

𝐚) 𝑷 𝒁 > 𝒁𝜶 = 𝟎. 𝟐𝟓

𝐛) 𝑷(𝒁 < 𝒁𝜶 ) = 𝟎. 𝟐𝟓

𝐜) 𝑷(𝒁 > 𝒁𝜶 ) = 𝟎. 𝟗𝟖𝟑

𝐝) 𝑷(𝒁 < 𝒁𝜶 ) = 𝟎. 𝟗𝟖𝟑

Ans:
a) 0.6745
b) -0.6745
c) -2.1201
SEM 2 2021,2022 d) 2.1201
 EXAMPLE 3 22

The mathematics scores in a test are scaled to have a normal

distribution with a mean of 500 and a standard deviation of 100.

a) What is the probability that a student taking the test will score below
350?

a) Remedial assistance will be given to students in the bottom 10%.

What is the maximum score of this group of students?

Ans:
a) 0.0668
SEM 2 2021,2022
b) 371.84 ≈ 372
SOLUTION
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a) X: Mathematics scores
Distribution of X is given by X~N (500,1002).

𝑃 𝑋 < 350
350 − 500
=𝑃 𝑍<
100
= 𝑃 𝑍 < −1.5
= 0.5 − 0.4332
= 𝟎. 𝟎𝟔𝟔𝟖

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SOLUTION
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P ( Z  Z ) = 
b) P ( X  max ) = 0.10

 max − 500   = 0.1

PZ   = 0.10
 100 
Z 0.1 = −1.2816

max − 500
 Z = = −1.2816
100
max = −1.2816 (100 ) + 500

= 371.84  372

SEM 2 2021,2022
 Calculate probability using excel
Normal distribution, X~N (μ, 𝝈𝟐 )
1. Find probability, 𝑷(𝑿 < 𝒙)/ 𝑷(𝑿 ≤ 𝒙)
- Use NORM.DIST function
2. Find 𝑿𝜶 , 𝑷 𝑿 < 𝒙𝜶 = 𝜶
- Use NORM.INV function
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NORM.DIST(x,mean,standard_dev,cumulative)
x : The value for which you want the distribution.
mean : The arithmetic mean of the distribution.
Standard_dev : The standard deviation of the distribution.
Cumulative : TRUE cumulative distribution function
FALSE probability density function.
NORM.INV(probability,mean,standard_dev)
Probability : A probability corresponding to the normal
distribution.
Mean : The arithmetic mean of the distribution.
Standard_dev :The standard deviation of the distribution.
Refer Excel Worksheet Week 7
 Calculate probability using excel 26

Standard normal distribution, Z~N (0,1)

NORM.S.DIST(z,cumulative)
1. Find probability, 𝑷(𝒁 < 𝒛)/ 𝑷(𝒁 ≤ 𝒛)
Z :The value for which you want the distribution.
Cumulative :TRUE cumulative distribution function
- Use NORM.S.DIST function FALSE probability mass function.

2. Find 𝒁𝜶 , 𝑷 𝒁 < 𝒁𝜶 = 𝜶
NORM.S.INV(probability)
- Use NORM.S.INV function
Probability :A probability corresponding to the normal
distribution.

Refer Excel Worksheet Week 7

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When do these approximation apply?

Binomial Poisson
𝑋~𝐵(𝑛, 𝑝) 𝑋~𝑃𝑜(λ)

Continuity correction factor

0.5 is added or subtracted
Normal Normal
Y~𝑁(𝑛𝑝, 𝑛𝑝𝑞) 𝑌~𝑁(λ, λ)

RULES RULE
1. n  30   10
2. Both np  5 and nq  5
 CONTINUOUS CORRECTION FACTOR 28
❑ The continuous correction factor needs to be made when
a continuous curve is being used to approximate
discrete probability distributions.
❑ 0.5 is added or subtracted as a continuous correction
factor according to the form of the probability statement as
follows:

a) P( X = x) ⎯⎯
c .c
→ P( x − 0.5  X  x + 0.5)
b) P( X  x) ⎯⎯
c .c
→ P( X  x + 0.5)
c) P( X  x) ⎯⎯
c .c
→ P( X  x − 0.5)
d) P( X  x) ⎯⎯
c .c
→ P( X  x − 0.5)
e) P( X  x) ⎯⎯c .c
→ P( X  x + 0.5)
c.c = continuous correction factor
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 EXAMPLE 4 29

In a certain country, 45% of registered voters are male.

If 300 registered voters from that country are selected at random, find
the probability that at least 155 are males.

Ans: 0.0119

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 In a certain country, 45% of registered voters are male.
SOLUTION
30
If 300 registered voters from that country are selected at random, find the probability that
at least 155 are males.
1. Get information from question
(n,p or λ) to determine the 𝑋 is the number of male voters.
distribution 𝑋 ∼ 𝐵(300,0.45)

2. Check the rules and change 𝑛 = 300 > 30

the distribution 𝑛𝑝 = 300(0.45) = 135 > 𝟓; 𝑛𝑞 = 300(0.55) = 165 > 𝟓
Therefore, 𝑌 ∼ 𝑁(mean,variance) = 𝑌 ∼ 𝑁(135,74.25)

3. Write the question 𝑐.𝑐

and apply continuous 𝑃(𝑋 ≥ 155) 𝑃(𝑌 > 155 − 0.5) = 𝑃(𝑌 > 154.5)
correction

𝑃(𝑌 > 154.5)

4. Solve using table 154.5 − 135
or Excel 𝑃 𝑍> = 𝑃(𝑍 > 2.26) = 0.5 − 0.4881 = 0.0119
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74.25
 EXAMPLE 5 31

A grocery store has an ATM machine inside. An average of 5 customers

per hour comes to use the machine.

What is the probability that more than 30 customers come to use the
machine between 8.00 am and 5.00 pm?

Ans: 0.9846

SEM 2 2021,2022
 A grocery store has an ATM machine inside. An average of 5 customers per hour comes to use the
SOLUTION
32
machine.
What is the probability that more than 30 customers come to use the machine between 8.00 am and
5.00 pm?
1. Get information from question
(n,p or λ) to determine the
distribution 𝑋 is the number of customers use the ATM machine in 9 hours.
𝑋 ∼ 𝑃𝑜 (45)

2. Check the rules and change

the distribution
𝜆 = 45 > 10
Y∼ 𝑁(𝜆, 𝜆) = 𝑌 ∼ 𝑁(45,45)

3. Write the question

and apply continuous P( X  30) ⎯⎯
c .c
→ P(Y  30 + 0.5) = P(Y  30.5)
correction

P(Y  30.5)
4. Solve using table  30.5 − 45 
or Excel PZ   = P( Z  −2.16) = 0.5 + 0.4846 = 0.9846
 45 
 EXERCISE 1 33

According to a survey by Duit magazine, 27% of women expect to support

their parents financially.
Assume that this percentage holds true for the current population of all
women. Suppose that a random sample of 300 women is taken.

Find the probability that exactly 79 of the women in this sample expect to
support their parents financially.

Ans (using mean=81, sd=7.6896):

Excel normal = 0.0501
Excel standard (Z value 4dp) = 0.0501
SEM 2 2021,2022 Table (Z value 2dp) = 0.05
 EXERCISE 2 34

In a university, the average of the students that come to the

student health center is 5 students per hour.

What is the probability that at least 40 students will come to

the student health center from 9.00 am to 6.00 pm?

Ans (using mean=45, sd=6.7082):

Excel normal = 0.7939
Excel standard (Z value 4dp) = 0.7939
SEM 2 2021,2022 Table (Z value 2dp) = 0.7939