Normal Distribution

Continuous Probability Distributions:
Normal Distribution
f (x)
Normal
Dr. Shraddha Mishra

IMI, New Delhi
Authors: Levine, Szabat, Stephan and Viswanathan
Chapter GS, Slide 1
Continuous Probability Distributions
 Unlike a discrete random variable, a
continuous random variable is one that can
assume an uncountable number of values.
 thickness of an item
 time required to complete a task
 temperature of a solution
 height
 These can potentially take on any value
depending only on the ability to precisely and
accurately measure

Chapter GS, Slide 2
Continuous Probability Distributions
 We cannot list the possible values because there
is an infinite number of them.
Because there is an infinite number of values, the
probability of each individual value is virtually 0.
Thus, we can determine the probability of a range
of values only.
So, in a continuous random variable, It is
meaningful to talk about P(X ≤ 5) and not P(X=5),
like discrete random variable.

Chapter GS, Slide 3
From a Discrete to a Continuous
Distribution
The time it takes to complete a task can be subdivided into:
Half-Minute (0.5) Intervals Quarter-Minute (0.25)Intervals Eighth-Minute Intervals (0.125)
Minutes to Complete Task: By Half-Minutes Minutes to Complete Task: Fourths of a Minute Minutes to Complete Task: Eighths of a Minute
0.15
0.10
P(x)
P(x)
P(x)
0.05
0.00
0.0
. 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5 6.0 6.5 0 1 2 3 4 5 6 7 0 1 2 3 4 5 6 7
Minutes Minutes Minutes
Or even infinitesimally small intervals:
Minutes to Complete Task: Probability Density Function

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Chapter GS, Slide 4
The Normal Distribution
 ‘Bell Shaped’
 Symmetrical
f(X)
 Mean, Median and Mode
are Equal
Location is determined by the
mean, μ σ
X
Spread is determined by the μ
standard deviation, σ
Mean
The random variable has an = Median
infinite theoretical range: = Mode
+  to  

Chapter GS, Slide 5
The Normal Distribution
Density Function
 The formula for the normal probability density function is
2
1  (X μ) 
1  
2  

f(X)  e
2π
Where e = the mathematical constant approximated by 2.71828
π = the mathematical constant approximated by 3.14159
μ = the population mean
σ = the population standard deviation
X = any value of the continuous variable

Chapter GS, Slide 6
By varying the parameters μ and σ, we
obtain different normal distributions
A
B
C
A and B have the same mean but different standard deviations.

B and C have different means and different standard deviations.
Chapter GS, Slide 7
The Normal Distribution Shape
f(X) Changing μ shifts the

distribution left or right.
Changing σ increases
or decreases the
σ spread.
μ X

Chapter GS, Slide 8
Normal Probability Distribution
All of these are normal probability density functions, though each has a
different mean and variance.
Normal Distribution:  =40, =1 Normal Distribution:  =30, =5 Normal Distribution:  =50, =3
0.4 0.2 0.2
0.3
f(w)
f(x)
f(y)
0.2 0.1 0.1
0.1
0.0 0.0 0.0

35 40 45 0 10 20 30 40 50 60 35 45 50 55 65
w x y
W~N(40,1) X~N(30,25) Y~N(50,9)

Normal Distribution:  =0, =1
0.4 Consider:
0.3
P(39  W  41) The probability in each

f(z)
0.2
0.1 P(25  X  35) case is an area under a

0.0 P(47  Y  53) normal probability
P(-1  Z  1)
-5 0 5
z density function.
Z~N(0,1)
Chapter GS, Slide 9
The Standardized Normal
 Any normal distribution (with any mean and
standard deviation combination) can be
transformed into the standardized normal
distribution (Z)
 To compute normal probabilities, need to

transform X units into Z units
 The standardized normal distribution (Z) has a

mean of 0 and a standard deviation of 1

Chapter GS, Slide 10
Translation to the Standardized
Normal Distribution
 Translate from X to the standardized normal
(the “Z” distribution) by subtracting the mean
of X and dividing by its standard deviation:
X μ
Z
σ
The Z distribution always has mean = 0 and
standard deviation = 1
The Standardized Normal
Probability Density Function
 The formula for the standardized normal
probability density function is
1 (1/2)Z 2
f(Z)  e
2π
Where e = the mathematical constant approximated by 2.71828

π = the mathematical constant approximated by 3.14159
Z = any value of the standardized normal distribution

The Standardized Normal Distribution
 Also known as the “Z” distribution

 Mean is 0
 Standard Deviation is 1
f(Z)
0 Z
Values above the mean have positive Z-values.

Values below the mean have negative Z-values.
Example: converting X to Z score
 If X is distributed normally with mean of $100

and standard deviation of $50, the Z value
for X = $200 is
X  μ $200  $100
Z   2.0
σ $50
 This says that X = $200 is two standard
deviations (2 increments of $50 units) above
the mean of $100.

Comparing X and Z score
$100 $200 $X (μ = $100, σ = $50)

0 2.0 Z (μ = 0, σ = 1)
Note that the shape of the distribution is the same,
only the scale has changed. We can express the
problem in the original units (X in dollars) or in
standardized units (Z)
Finding Normal Probabilities
Probability is measured by the area under

the curve
f(X)
P (a ≤ X ≤ b)
= P (a < X < b)
(Note that the probability
of any individual value is
zero)
a b X

Probability as
Area Under the Curve
The total area under the curve is 1.0, and the curve is
symmetric, so half is above the mean, half is below
f(X) P(   X  μ)  0.5
P(μ  X   )  0.5
0.5 0.5
μ X
P(   X   )  1.0
The Standardized Normal Table
 The Standardized Normal table gives the

probability from mean to a desired value of Z
(i.e., from zero to Z)
0.5+.4772=0.9772
Example:
P(Z < 2.00) = 0.9772
0 2.00 Z

The Standardized Normal Table
(continued)
The column gives the value of

Z to the second decimal point
Z 0.00 0.01 0.02 …
0.0
The row shows
the value of Z 0.1
.
to the first . The value within the
decimal point . table gives the
2.0 .4772
probability from Z = 0
up to the desired Z
2.0
P(Z < 2.00) = 0.9772 value

General Procedure for Finding
Normal Probabilities
To find P(a < X < b) when X is distributed

normally:
 Draw the normal curve for the problem in

terms of X
 Translate X-values to Z-values
 Use the Standardized Normal Table

Example: Finding Normal Probabilities
 Let X represent the time it takes (in seconds) to
download an image file from the internet.
 Suppose X is normal with a mean of 18.0
seconds and a standard deviation of 5.0
seconds. Find P(X < 18.6)
X
18.0
18.6
Finding Normal Probabilities
(continued)
 Let X represent the time it takes, in seconds to download an image file from
the internet.
 Suppose X is normal with a mean of 18.0 seconds and a standard deviation
of 5.0 seconds. Find P(X < 18.6)
X  μ 18.6  18.0
Z   0.12
σ 5.0
μ = 18 μ=0
σ=5 σ=1
18 18.6 X 0 0.12 Z
P(X < 18.6) P(Z < 0.12)

Solution: Finding P(Z < 0.12)
Standardized Normal Probability P(X < 18.6)

Table (Portion) = P(Z < 0.12)
Z .00 .01 .02 0.5+0.0478
0.0 .0000 .0040 .0080
0.1 .0398 .0438 .0478

0.2 .0793 .0832 .0871
Z
0.00
0.3 .1179 .1217 .1255
0.12

Finding Normal
Upper Tail Probabilities
 Suppose X is normal with mean 18.0
and standard deviation 5.0
 Now Find P(X > 18.6)
X
18.0
18.6

Finding Normal
Upper Tail Probabilities
(continued)
 Now Find P(X > 18.6)…
P(X > 18.6) = P(Z > 0.12) = 0.5 - P(Z ≤ 0.12)
= 0.5- 0.0478 = 0.4522
0.0478
0.5 0.5 - 0.0478
= 0.4522
Z Z
0 0
0.12 0.12
Finding a Normal Probability
Between Two Values
 Suppose X is normal with mean 18.0 and
standard deviation 5.0. Find P(18 < X < 18.6)
Calculate Z-values:
X  μ 18  18
Z  0
σ 5
18 18.6 X
X  μ 18.6  18 0 0.12 Z
Z   0.12
σ 5 P(18 < X < 18.6)
= P(0 < Z < 0.12)
Solution: Finding P(0 < Z < 0.12)
Standardized Normal Probability P(18 < X < 18.6)

Table (Portion) = P(0 < Z < 0.12)
= 0.0478
Z .00 .01 .02
0.0 .0000 .0040 .0080 0.0478
0.5000
0.1 .0398 .0438 .0478
0.2 .0793 .0832 .0871
0.3 .1179 .1217 .1255 Z

0.00
0.12
Probabilities in the Lower Tail
 Suppose X is normal with mean 18.0
and standard deviation 5.0.
 Now Find P(17.4 < X < 18)
X
18.0
17.4
Probabilities in the Lower Tail
(continued)
Now Find P(17.4 < X < 18)…

The Normal distribution is
symmetric, so this probability
is the same as P(0 < Z < 0.12) 0.0478
0.4522
17.4 18.0 X
-0.12 0 Z

Empirical Rule
What can we say about the distribution of values
around the mean? For any normal distribution:
f(X)
μ ± 1σ encloses about
68.26% of X’s
σ σ
μ-1σ μ μ+1σ X
68.26%
The Empirical Rule
(continued)
 μ ± 2σ covers about 95.44% of X’s

 μ ± 3σ covers about 99.73% of X’s
2σ 2σ 3σ 3σ
μ x μ x
95.44% 99.73%

Normal Probability Distribution
Characteristics (basis for the empirical rule)

Given a Normal Probability
Find the X Value
 Steps to find the X value for a known
probability:
1. Find the Z value for the known probability
2. Convert to X units using the formula:
X  μ  Zσ

Finding the X value for a
Known Probability (continued)
Example:
 Let X represent the time it takes (in seconds) to
download an image file from the internet.
 Suppose X is normal with mean 18.0 and standard
deviation 5.0
 Find X such that 20% of download times are less than
X.
0.2000
? 18.0 X
? 0 Z
Find the Z value for
20% in the Lower Tail
1. Find the Z value for the known probability
Standardized Normal Probability  20% area in the lower
Table (Portion) tail is consistent with a
Z … .03 .04 .05 Z value of -0.84
0.9 … .3238 .3264 .3289

0.2
0.8 … .2967 .2995 .3023
0.7 … .2673 .2704 .2734
? 18.0 X
-0.84 0 Z

Finding the X value
2. Convert to X units using the formula:
X  μ  Zσ
 18.0  (0.84)5.0
 13.8
So 20% of the values from a distribution

with mean 18.0 and standard deviation
5.0 are less than 13.80

Excel Can Be Used To Find Normal
Probabilities
Find P(X < 9) where X is normal with a mean of 7
and a standard deviation of 2

Example: Demand at Gas Station
Suppose that at a gas station the daily demand for
regular gasoline is normally distributed with a mean of
1,000 gallons and a standard deviation of 100 gallons.
The station manager has just opened the station for

business and notes that there is exactly 1,100 gallons
of regular gasoline in storage.
The next delivery is scheduled later today at the close

of business. The manager would like to know the
probability that he will have enough regular gasoline to
satisfy today’s demands or P(X < 1,100)
The demand is normally distributed with mean µ =

1,000 and standard deviation σ = 100. We want to find
the probability P(X < 1,100). Graphically we want to
calculate:
P(Z < 1.00) can be
P (x <1,100) calculated using can be
solved by
1. Excel (shown later)
2. Empirical Rule
discussed before
3. Using Standard Normal
Probability Table

P(X<1,100) using Excel

P(X<1,100) using Empirical Rule
Rule: 68.26% of values of a normal random variable are within +/- 1
standard deviation of its mean. P(μ -1σ<=X<= μ +1σ) = 68.26%; So,
distribution being perfectly symmetrical, P(μ <=X<= μ +1σ) = 34.13%
So, P(X<=1100) =
0.5+0.3413 = 0.8413
P(X <= 1,100)
=P(X<= μ +1σ) OR,
1- 0.68= 0.32 area is
outside ± 1σ; i.e., 0.16 for
each half
So, P(X<=1100) = 0.68 +

0.16 = 0.84
μ=1000,
σ=100Levine, Szabat, Stephan and Viswanathan
Authors:
using Standard Normal Prob Table
Step 1: Convert x to the standard normal distribution.
 X   1,100  1,000 
P(X < 1,100) = P   = P(Z < 1.00)
  100 
Reading from the table
P(X < 1,100) = P(Z < 1.00) = 0.84134

(table 1)
=.3413 + 0.5 = 0.8413 (table 2)

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 stock-outs while waiting for a replenishment order.
The manager would like to know the probability of a stock-out

during replenishment lead-time. In other words, what is the
probability that demand during lead-time will exceed 20
gallons?
It has been determined that demand during replenishment

lead-time is normally distributed with a mean of 15 gallons and
a standard deviation of 6Authors:
gallons.
Levine, Szabat, Stephan and Viswanathan
Example: Pep Zone
Solving for the Stock-out Probability P(X>20)?
Step 1: Convert x to the standard normal

distribution. z = (x - )/
= (20 - 15)/6
= .83
Step 2: To find P(Z > 0.83) , we need to first find

the area under the standard normal curve to the left
of z = .83.
Example: Pep Zone using Standard
Normal Prob Table Value read from table 2
P ( z > 0.83) = 1- (0.5+0.2967)=1- 0.7967 = 0.2033
Probability of no Probability of a
Stock-out during Stock-out during
replenishment replenishment
lead-time = P(z< 0.83) lead-time = P(Z>0.83)
= .7967 = 0.2033
z
0 .83
Example: Pep Zone
If the manager of Pep Zone wants the probability

of a stock-out during replenishment lead-time to be
no more than .05, what should the reorder point be
or what should be X?
HINT: Given a probability, we can use the standard normal table in an

inverse fashion to find the corresponding z value.
In earlier case we moved from X to Z and read the probabilities from the
table, here we would first find Z for a corresponding probability which is
0.05 now and then we will move forward from Z to X using X = μ + σZ.

Example: Pep Zone
Step 1: finding the cut-off point
Area = .0500
z
0 z.05
P(Z > zA) = 0.05=> P(Z<= zA ) = 0.5-0.05 => P(Z<= zA ) = 0.45;
So, looking up the table 2 , Z= 1.64 gives prob 0.45

Example: Pep Zone
Step 2: Convert z.05 to the corresponding value of x.
x =  + z.05
 = 15 + 1.645(6)
= 24.87 or 25
A reorder point of 25 gallons will place the
probability of a stock-out during lead time at (slightly
less than) .05.

Example: Pep Zone
Solving for the Reorder Point
Probability of no
Probability of a
Stock-out during
Stock-out during
replenishment
replenishment
lead-time = .95
lead-time = .05
x
15 24.87

Example: Pep Zone
Solving for the Reorder Point
By raising the reorder point from 20 gallons to 25

gallons on hand, the probability of a stock-out
decreases from about .20 to .05.
This is a significant decrease in the chance that

Pep Zone will be out of stock and unable to meet a
customer’s desire to make a purchase.

Example: Investment Decisions
Consider an investment whose return is normally

distributed with a mean of 10% and a standard
deviation of 5%.
a) Determine the probability of losing money or
P(X<0)
b) Find the probability of losing money when the
standard deviation is equal to 10%.

The investment loses money when the return is
negative. Thus, we wish to determine
P(X < 0)
The first step is to standardize both X and 0 in the
probability statement.
 X   0  10 
P(X < 0) = P   = P(Z < – 2.00) ;
  5 
which is same as P(Z > 2)= 0.5 - 0.4772=0.0228;
using standard normal probability table (2).
Therefore, the probability of losing money is .0228

If we increase the standard deviation to 10% the

probability of suffering a loss becomes
 X   0  10 
P(X < 0) = P  
  10 
= P(Z < –1.00) ; P(Z >1)
Find P(Z >1) = (read from table 2)
= .1587

Practice problem: Training program ??
Suppose we have a training program designed to upgrade the supervisory
skills of production-line supervisors. Because the program is self-
administered, supervisors require different number of hours to complete the
program. A study of past participants indicate that the mean length of time
spent on the program is 500 hours and this normally distributed random
variable has a standard deviation of 100 hours.
i. What is the probability that a participant selected at random will require
more than 500 hours to complete the program? (0.5)
ii. What is the probability that a candidate selected at random will take
between 500 and 650 hours to complete the training program? (0.4332)
iii. What is the probability that a candidate selected at random will take
more than 700 hours to complete the training program? (0.0228)
iv. Suppose that the training program director wants to know the probability
that a participant chosen at random would require- between 550 and
650 hours to complete the required work. (0.2417)
v. What is the probability that a candidate selected at random will require
fewer than 580 hours to complete the training program? (0.7881)
vi. What is the probability that a candidate selected at random will take
between 420 and 570 hours to complete the training program? (0.5462)

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Continuous Probability Distributions:

Dr. Shraddha Mishra

Authors: Levine, Szabat, Stephan and Viswanathan

Authors: Levine, Szabat, Stephan and Viswanathan

Or even infinitesimally small intervals:

Minutes to Complete Task: Probability Density Function

Authors: Levine, Szabat, Stephan and Viswanathan

Authors: Levine, Szabat, Stephan and Viswanathan

A and B have the same mean but different standard deviations.

f(X) Changing μ shifts the

Authors: Levine, Szabat, Stephan and Viswanathan

0.0 0.0 0.0

W~N(40,1) X~N(30,25) Y~N(50,9)

P(39  W  41) The probability in each

0.1 P(25  X  35) case is an area under a

 To compute normal probabilities, need to

 The standardized normal distribution (Z) has a

Authors: Levine, Szabat, Stephan and Viswanathan

Where e = the mathematical constant approximated by 2.71828

Authors: Levine, Szabat, Stephan and Viswanathan

 Also known as the “Z” distribution

Values above the mean have positive Z-values.

 If X is distributed normally with mean of $100

Authors: Levine, Szabat, Stephan and Viswanathan

$100 $200 $X (μ = $100, σ = $50)

Probability is measured by the area under

Authors: Levine, Szabat, Stephan and Viswanathan

 The Standardized Normal table gives the

Authors: Levine, Szabat, Stephan and Viswanathan

The column gives the value of

Authors: Levine, Szabat, Stephan and Viswanathan

To find P(a < X < b) when X is distributed

 Draw the normal curve for the problem in

 Translate X-values to Z-values

 Use the Standardized Normal Table

Authors: Levine, Szabat, Stephan and Viswanathan

P(X < 18.6) P(Z < 0.12)

Authors: Levine, Szabat, Stephan and Viswanathan

Standardized Normal Probability P(X < 18.6)

0.1 .0398 .0438 .0478

Authors: Levine, Szabat, Stephan and Viswanathan

Authors: Levine, Szabat, Stephan and Viswanathan

Standardized Normal Probability P(18 < X < 18.6)

0.3 .1179 .1217 .1255 Z

Now Find P(17.4 < X < 18)…

Authors: Levine, Szabat, Stephan and Viswanathan

 μ ± 2σ covers about 95.44% of X’s

Authors: Levine, Szabat, Stephan and Viswanathan

Authors: Levine, Szabat, Stephan and Viswanathan

Authors: Levine, Szabat, Stephan and Viswanathan

0.9 … .3238 .3264 .3289

Authors: Levine, Szabat, Stephan and Viswanathan

So 20% of the values from a distribution

Authors: Levine, Szabat, Stephan and Viswanathan

Authors: Levine, Szabat, Stephan and Viswanathan

The station manager has just opened the station for

The next delivery is scheduled later today at the close

The demand is normally distributed with mean µ =

Authors: Levine, Szabat, Stephan and Viswanathan