E370

5/13/17
Continuing Continuous
DistributionsThe
Standard Normal
Week 07, Part 4
Alittle review of linear
transformations: If X is
continuous with a mean of x, and
a standard deviation of x, how is
distributed?
What is the expected value of ?

A linear transformation
What is the standard deviation of
?
SQRT(V(H))

Transformation continued
The most important member of the
normal family is X =Z ~ N(0,1),
the Standard Normal or the Z
Distribution.
Any normal can be transformed
into the standard normal using the
transformation formula:

The Standard
 Its a way to compare one normal
distribution to another, in the same way
the coefficient of variation did for
dispersion and the correlation coefficient
does for strength of a possible linear
relationship.
This is a way to compare an observation
from one distribution to an observation
from another.
It isnt unit free per se, but instead is a
transformation of a value into a measure
of distance from the mean. . .

Whats it good for?

. . . specifically, the number of
standard deviations from the mean.

A college basketball coach wants to
recruit tall players who will be able to
handle the academic demands of
college. The criteria that are set are
that the player must be at least 74
inches tall and have an IQ of at least
115. Height~N(70,2) and
IQ~N(100,12).
Ofthe criteria, which will be the
hardest to satisfy?

For Example,
 X~N(1.5, 0.1)
B
At the Bellagio, how many
ounces of distilled spirits would
be in a drink with a Z-score of
1.5?

At the Bellagio . . .
XB~N(1.5, 0.1)
The Vegas Alcohol Commission will
revoke the liquor license for any
establishment found to be serving
mixed drinks with more than 1.8
ounces of distilled spirits per
drink. Approximately, how likely is
it that the Alcohol Commission will
have cause to revoke the liquor
license for the Bellagio?
=NORM.DIST(Z,0,1,1)=NORM.
S.DIST(Z,1)

=NORM.INV(, 0, 1) =
NORM.S.INV()

Some Excel Command

Equivalents