Lind18e Chapter07 TB AnswerKey

Statistical Techniques in Business and Economics, 18e (Lind)
Chapter 7 Continuous Probability Distributions
1) For any uniform probability distribution, the mean and standard deviation can be computed
based on the maximum and minimum values of the random variable.
Answer: TRUE
Explanation: For the uniform probability distribution, where a = minimum and b = maximum
values, then μ = and σ = .

Difficulty: 1 Easy
Topic: The Family of Uniform Probability Distributions
Learning Objective: 07-01 Describe the uniform probability distribution and use it to calculate
probabilities.
Bloom's: Understand
AACSB: Communication
2) For a uniformly distributed random variable, x, P(x) is constant.
Answer: TRUE
Explanation: For a continuous uniform random variable, P(x) = , where a = minimum value
of X and b = maximum value of X. Probability, therefore, is a constant for any value of X.
Difficulty: 1 Easy
probabilities.
Bloom's: Remember
3) For a uniformly distributed random variable, x, P(x) = 1/(b − a).
Answer: TRUE
Explanation: For a continuous uniform random variable, P(x) = , where a = minimum value
of X and b = maximum value of X.
Difficulty: 1 Easy
probabilities.
Bloom's: Remember
1
Copyright © 2021 McGraw-Hill
4) When referring to the normal probability distribution, there is not just one; there is a "family"
of normal probability distributions.
Answer: TRUE
Explanation: For each random variable X, different variables will have different means,
different standard deviations, and will be measured in different units. Some may vary a lot
around the mean, while others will vary a little. This is why we "standardize" the X values to a z-
value, which has a mean of 0 and a standard deviation of 1, expressed in units of the standard
deviation. This allows us to use a single set of standard normal tables to calculate probabilities
for any normally distributed variable.
Difficulty: 1 Easy
Topic: The Family of Normal Probability Distributions
Learning Objective: 07-02 Describe the characteristics of a normal probability distribution.
Bloom's: Remember
Accessibility: Keyboard Navigation
5) A group of normal distributions can have equal arithmetic means but different standard
deviations.
Answer: TRUE
Explanation: The mean of a normal distribution determines where the distribution is centered,
while the standard deviation expresses something about the spread or variability of the
distribution. When expressed in the value of a random variable, X, even if the means are the
same, each distribution is likely to have different standard deviations.
Difficulty: 1 Easy
Bloom's: Understand
6) Some normal probability distributions are positively skewed.
Answer: FALSE
Explanation: All normal distributions are symmetric and centered on the distribution's mean,
median, and mode.
Difficulty: 1 Easy
Bloom's: Remember
2
7) Within plus and minus one standard deviation of the mean, the area under any normal curve is
about 68%.
Answer: TRUE
Explanation: The empirical rule states that about 68% of the values of a normal curve will lie
between one standard deviation above and one standard deviation below the mean.
Difficulty: 1 Easy
Topic: The Standard Normal Probability Distribution
Learning Objective: 07-03 Describe the standard normal probability distribution and use it to
calculate probabilities.
Bloom's: Remember
8) The standard normal distribution is a special normal distribution with a mean of 0 and a
standard deviation of 1.
Answer: TRUE
Explanation: When we convert a normal variable X to a standard normal variable Z, the mean is
always equal to zero and the standard deviation is always equal to one.
Difficulty: 1 Easy
Bloom's: Remember
9) The z-scores for X values greater than the mean are negative.
Answer: FALSE
Explanation: The numerator of the z-score formula is (x − μ). When x is greater than μ, the
difference is always positive.
Difficulty: 1 Easy
Bloom's: Understand
3
10) Nonstop Airlines determined that the mean number of passengers per flight is 152 with a
standard deviation of 10 passengers. Practically all flights have between 142 and 162 passengers.
Answer: FALSE
Explanation: The values of 142 and 162 are within one standard deviation of the mean of 152.
Based on the empirical rule, about 68% of the flights will be within one standard deviation of the
mean.
Difficulty: 2 Medium
Bloom's: Understand
11) The number of different standard normal distributions is unlimited.
Answer: FALSE
Explanation: There is only one standard normal distribution where the mean is zero and the
standard deviation is one. There are, however, an unlimited number of normal distributions (not
standardized in terms of z).
Difficulty: 1 Easy
Bloom's: Remember
12) The normal distribution can be used to approximate a binomial distribution when nπ is less
than 5.
Answer: FALSE
Explanation: To use the normal approximation to the binomial, nπ must be greater than 5.
Difficulty: 1 Easy
Topic: The Normal Approximation to the Binomial
Learning Objective: 07-04 Approximate the binomial probability distribution using the standard
normal probability distribution to calculate probabilities.
Bloom's: Remember
4
13) A "continuity correction factor" is used to compute probabilities when using the normal
distribution to approximate the binomial distribution.
Answer: TRUE
Explanation: As the normal distribution is continuous and the binomial distribution is discrete,
we need to add or subtract 0.5 to "extend" the continuous value of X. This allows us to more
closely approximate a discrete variable despite using a continuous distribution to estimate
probability.
Difficulty: 1 Easy
Bloom's: Remember
14) For the exponential distribution, the mean and standard deviation are equal.
Answer: TRUE
Explanation: In the exponential probability distribution, both the mean and standard deviation
are equal to 1/λ.
Difficulty: 1 Easy
Topic: The Family of Exponential Distributions
Learning Objective: 07-05 Describe the exponential probability distribution and use it to
Bloom's: Remember
15) The exponential distribution is a probability distribution for a random variable measured as a
rate of an event occurring.
Answer: TRUE
Explanation: The exponential distribution describes the time between events in a sequence,
where the events occur at a constant rate per unit of time.
Difficulty: 1 Easy
Bloom's: Remember
5
16) The shape of any uniform probability distribution is ________.
A) negatively skewed
B) positively skewed
C) rectangular
D) bell-shaped
Answer: C
Explanation: The uniform probability distribution is rectangular in shape and is defined by
minimum and maximum values.
Difficulty: 1 Easy
probabilities.
Bloom's: Remember
17) The mean of any uniform probability distribution is ________.

A) (b − a)/2
B) (a + b)/2
C) ∑
D) nπ
Answer: B
Explanation: The mean of a uniform distribution is located in the middle of the interval between
the minimum and maximum values. It is computed as (a + b)/2.
Difficulty: 1 Easy
probabilities.
Bloom's: Remember
6
18) The standard deviation of any uniform probability distribution is ________.
A) (b - a)/2
B) n(1 - π)
C)
D) )
Answer: C
Explanation: In the uniform distribution, the standard deviation is related to the interval between
the maximum and minimum values as the square root of (b − a)2/12.
Difficulty: 1 Easy
probabilities.
Bloom's: Remember
19) The upper and lower limits of a uniform probability distribution are ________.
A) positive and negative infinity
B) plus and minus three standard deviations
C) 0 and 1
D) the maximum and minimum values of the random variable
Answer: D
Explanation: The uniform probability distribution is rectangular in shape and is defined by
minimum and maximum values of a random variable.
Difficulty: 1 Easy
probabilities.
Bloom's: Understand
7
20) The time to fly between New York City and Chicago is uniformly distributed with a
minimum of 120 minutes and a maximum of 150 minutes. What is the distribution's mean?
A) 120 minutes
B) 150 minutes
C) 135 minutes
D) 270 minutes
Answer: C
Explanation: The mean of a uniform distribution is the center of the interval between the
minimum and maximum values. In this case, it is 135 minutes, found by (120 + 150)/2.
Difficulty: 1 Easy
probabilities.
Bloom's: Apply
AACSB: Communication; Analytic
minimum of 120 minutes and a maximum of 150 minutes. What is the distribution's standard
deviation?
A) 8.66 minutes
B) 75 minutes
C) 135 minutes
D) 270 minutes
Answer: A
Explanation: In the uniform distribution, the standard deviation is related to the interval between
the maximum and minimum values. In this case, it is 8.66 minutes, found by determining the
square root of (150 − 120)2/12.
Difficulty: 1 Easy
probabilities.
Bloom's: Apply
AACSB: Analytic
8
minimum of 120 minutes and a maximum of 150 minutes. What is the probability that a flight is
less than 135 minutes?
A) 1.00
B) 0.50
C) 0.25
D) 0.00
Answer: B
Explanation: The probability is computed as the area under the curve. For a uniform
distribution, it is the area of a defined rectangle. In this case, the base is (135 − 120) and the
height is
(1/(150 − 120), or (135 − 120) × (1/(150 − 120))) = 15/30 = 0.5.
Difficulty: 1 Easy
probabilities.
Bloom's: Apply
AACSB: Analytic
more than 140 minutes?
A) 1.00
B) 0.50
C) 0.333
D) 0.00
Answer: C
height is
(1/(150 − 120), or (150 − 140) × (1/(150 − 120))) = 10/30 = 0.333.
Difficulty: 1 Easy
probabilities.
Bloom's: Apply
AACSB: Analytic
9
between 125 and 140 minutes?
A) 1.00
B) 0.50
C) 0.33
D) 10.00
Answer: B
height is
(1/(150 − 120), or (140 − 125) × (1/(150 − 120))) = 15/30 = 0.5.
Difficulty: 1 Easy
probabilities.
Bloom's: Apply
AACSB: Analytic
25) What is an important similarity between the uniform and normal probability distributions?
A) The mean, median, and mode are all equal.
B) The mean and median are equal.
C) They are negatively skewed.
D) About 68% of all observations are within one standard deviation of the mean.
Answer: B
Explanation: Both the uniform and normal probability distributions are symmetric. So the mean
and median are equal. The uniform is rectangular and does not have a defined mode.
Bloom's: Understand
10
26) Which of the following is true regarding the normal distribution?
A) The mean, median, and mode are all equal.
B) It has two modes.
C) It is asymmetrical.
D) The points of the curve meet the x-axis at z = −3 and z = 3.
Answer: A
Explanation: The normal probability distribution is bell-shaped and has a single peak at the
center of the distribution. The arithmetic mean, median, and mode are equal and located in the
center of the distribution.
Difficulty: 1 Easy
Bloom's: Understand
27) For the normal distribution, the mean plus and minus two standard deviations will include
about what percent of the observations?
A) 50%
B) 99.7%
C) 95%
D) 68%
Answer: C
Explanation: The empirical rule states that about 95% of the area under the normal curve is
within two standard deviations of the mean.
Bloom's: Understand
11
28) For a standard normal distribution, what is the probability that z is greater than 1.75?
A) 0.0401
B) 0.0459
C) 0.4599
D) 0.9599
Answer: A
Explanation: The probability that z is greater than 1.75 is 0.0401, found by 0.5000 − 0.4599.
Recall half the area, or probability, is above the mean, and half is below. Using the standard
normal probability distribution table, the area under the normal curve between 0 and 1.75 is
0.4599.
Bloom's: Apply
AACSB: Analytic
29) What is the area under the normal curve between z = 0.0 and z = 1.79?
A) 0.4633
B) 0.0367
C) 0.9599
D) 0.0401
Answer: A
Explanation: Using the "areas under the normal curve" table, the area under the normal curve
between 0 and 1.79 is 0.4633.
Bloom's: Apply
AACSB: Analytic
12
30) What is the area under the normal curve between z = −1.0 and z = −2.0?
A) 0.0228
B) 0.3413
C) 0.1359
D) 0.4772
Answer: C
Explanation: Because the normal distribution is symmetric, the area between 0 and a negative z-
value is the same as that between 0 and the corresponding positive z-value. Using the "areas
under the normal curve" table, the area under the normal curve between the mean and z = −1.0 is
0.3413, and between the mean and z = −2.0 is 0.4772. By subtraction, the area between z = −1.0
and z = −2.0 is 0.4772 − 0.3413 = 0.1359.
Bloom's: Apply
AACSB: Analytic
31) What is the probability that z is between 0.0 and 2.0?

A) 1.0000
B) 0.7408
C) 0.1359
D) 0.4772
Answer: D
between 0 and 2.0 is 0.4772.
Bloom's: Apply
AACSB: Analytic
13
32) The mean amount spent by a family of four on food is $500 per month with a standard
deviation of $75. Assuming that the food costs are normally distributed, what is the probability
that a family spends less than $410 per month?
A) 0.2158
B) 0.8750
C) 0.0362
D) 0.1151
Answer: D
Explanation: Begin by finding the z-value corresponding to a monthly amount spent of $410:
z = (410 − 500)/75 = −1.2. Then, using the "areas under the normal curve" table, find the
probability z is less than −1.2 by finding the probability that z is between −1.2 and 0, which is
0.3849. To find the probability that z is less than −1.2, compute 0.5000 − 0.3849 = 0.1151.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
33) Which of the following is a characteristic of the normal probability distribution?

A) It's positively skewed.
B) It's bell-shaped.
C) It's asymmetrical.
D) It's rectangular.
Answer: B
Explanation: The normal probability distribution is bell-shaped and has a single peak at the
center of the distribution. The arithmetic mean, median, and mode are equal and located in the
center of the distribution.
Difficulty: 1 Easy
Bloom's: Understand
14
34) For a normal distribution, what is the likelihood (expressed as a percentage) that a random
variable is within plus and minus two standard deviations of the mean?
A) 68.26%
B) 99.74%
C) 34.13%
D) 95.44%
Answer: D
between 0 and 2.0 is 0.4772. Because the normal distribution is symmetric, the area between 0
and a negative z-value is the same as that between 0 and the corresponding positive z-value. That
means the area between 0 and −2.0 is also 0.4772. Thus, the area under the normal curve within
two standard deviations of the mean is 95.44%, found by 2(0.4772).
Difficulty: 1 Easy
Bloom's: Understand
35) The mean score of a college entrance test is 500; the standard deviation is 75. The scores are
normally distributed. What percent of the students scored below 320?
A) About 50.82%
B) About 34.13%
C) About 7.86%
D) About 0.82%
Answer: D
Explanation: Begin by finding the z-value corresponding to a score of 320: z = (320 − 500)/75 =
−2.4. Then, using the "areas under the normal curve" table, find the probability z is less than −2.4
is 0.0082, by computing 0.5000 − 0.4918. Thus, 0.82% of the students scored below 320.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
15
36) The weekly incomes of a large group of executives are normally distributed with a mean of
$2,000 and a standard deviation of $100. What is the z-score for an income of $2,100?
A) 1.00
B) 2.00
C) 1.683
D) −0.90
Answer: A
Explanation: Find the z-value corresponding to an income of $2,100 by: z = (x − μ)/σ = (2,100 −
2,000)/100 = 1.00.
Bloom's: Apply
AACSB: Analytic
37) A new extended-life light bulb has an average life of 750 hours, with a standard deviation of
50 hours. If the life of these light bulbs approximates a normal distribution, about what percent
of the distribution will be between 600 hours and 900 hours?
A) 95%
B) 68%
C) 34%
D) 99.74%
Answer: D
Explanation: Begin by finding the z-values corresponding to 600 and 900 hours. They are: −3,
found by (600 − 750)/50, and +3, found by (600 − 750)/50. Then, using the "areas under the
normal curve" table, find the probability that z is between −3 and 3, which is 0.9974, by adding
0.4987 and 0.4987. Remember, because the normal distribution is symmetric, the area between 0
and a negative z-value is the same as that between 0 and the corresponding positive z-value. This
means that 99.74% of the light bulb life distribution will be between 600 and 900 hours.
Bloom's: Apply
AACSB: Analytic
16
38) A study of a company's practice regarding the payment of invoices revealed that an invoice
was paid an average of 20 days after it was received. The standard deviation equaled five days.
Assuming that the distribution is normal, what percent of the invoices were paid within 15 days
of receipt?
A) 15.87%
B) 37.91%
C) 34.13%
D) 86.74%
Answer: A
Explanation: Begin by finding the z-value corresponding to 15 days, from:
z = ((x − μ)⁄σ):(x − μ)⁄σ z = (15 − 20)/5 = −1.0. Then, using the "areas under the normal curve"
table, find the probability that z is less than −1.0 is 0.1587, by computing 0.5000 − 0.3413. Thus,
15.87% of the invoices are paid within 15 days of receipt.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
39) An accelerated life test on a large number of type-D alkaline batteries revealed that the mean
life for a particular use before they failed is 19.0 hours. The distribution of the lives
approximated a normal distribution. The standard deviation of the distribution was 1.2 hours.
About 95.44% of the batteries failed between what two values?
A) 8.9 and 18.9
B) 12.2 and 14.2
C) 14.1 and 22.1
D) 16.6 and 21.4
Answer: D
within two standard deviations of the mean. The two values are 16.6 and 21.4, found by 19.0
plus or minus 2(σ) = 2(1.2) = 2.4.
Bloom's: Apply
AACSB: Analytic
17
40) The mean of a normal distribution is 400 pounds. The standard deviation is 10 pounds. What
is the probability of a weight between 415 pounds and the mean of 400 pounds?
A) 0.5000
B) 0.1932
C) 0.4332
D) 0.3413
Answer: C
Explanation: Begin by finding the z-value corresponding to 415 pounds, from formula:
z = (x − μ)/σ: z =(x − μ)/σ = (415 − 400)/10 = 1.5. Then, find the probability z is between 0 and
1.5 is 0.4332 by using the "areas under the normal curve" table.
Bloom's: Apply
AACSB: Analytic
41) The distribution of the annual incomes of a group of middle management employees
approximated a normal distribution with a mean of $37,200 and a standard deviation of $800.
About 68% of the incomes lie between what two incomes?
A) $30,000 and $40,000
B) $36,400 and $38,000
C) $34,800 and $39,600
D) $35,600 and $38,800
Answer: B
within one standard deviation of the mean. The two incomes are $36,400 and $38,000, found by
$37,200 plus or minus $800.
Bloom's: Apply
AACSB: Analytic
18
42) Which of the following is true in a normal distribution?
A) The mean equals zero.
B) The mode and the third quartile are equal.
C) The mean divides the distribution into two equal areas.
D) The area under the curve is 0.68.
Answer: C
Explanation: The normal probability distribution is bell-shaped, with the mean located in the
exact center of the distribution. Therefore, the mean divides the distribution into two equal areas
of 0.5.
Difficulty: 1 Easy
Bloom's: Understand
AACSB: Analytic
43) Tables of normal distribution probabilities are found in many statistics books. These
probabilities are calculated from a normal distribution with ________.
A) a mean of 1 and a standard deviation of 1
B) a mean of 100 and a standard deviation of 15
C) a mean of 0 and a standard deviation of 15
D) a mean of 0 and a standard deviation of 1
Answer: D
Explanation: The probabilities for a normal distribution are given in tables for the standard
normal probability distribution, which has a mean of 0 and a standard deviation of 1.
Difficulty: 1 Easy
Bloom's: Understand
19
44) Two normal distributions are compared. One has a mean of 10 and a standard deviation of
10. The second normal distribution has a mean of 10 and a standard deviation of 2. Which of the
following is true?
A) The locations of the distributions are different.
B) The distributions are from two different families of distributions.
C) The dispersions of the distributions are different.
D) The dispersions of the distributions are the same.
Answer: C
Explanation: The mean is a measure of location and the standard deviation is a measure of
dispersion. Both distributions have the same location, but their dispersions are different.
Difficulty: 1 Easy
Bloom's: Understand
45) A normally distributed random variable has ________.

A) any value between −∞ and + ∞
B) discrete values
C) any value between specified minimum and maximum values
D) only two values, success and failure
Answer: A
Explanation: A normally distributed random variable is continuous and ranges between −∞ and
+ ∞.
Difficulty: 1 Easy
Bloom's: Understand
46) The total area of a normal probability distribution is ________.

A) between −3.0 and 3.0
B) 1.00
C) dependent on a value of z
D) approximated by the binomial distribution
Answer: B
Explanation: Just like any continuous probability distribution, the total area or probability under
the normal curve is 1.00.
Difficulty: 1 Easy
Bloom's: Understand
20
47) In an illustration of a normal probability distribution, a shaded area represents ________.
A) a permutation
B) a combination
C) a probability
D) a standard deviation
Answer: C
Explanation: As with any continuous probability distribution, areas below the normal curve
represent probabilities.
Difficulty: 1 Easy
Bloom's: Understand
48) The standard normal probability distribution is unique because it has ________.
A) a mean of 1 and any standard deviation
B) any mean and a standard deviation of 1
C) a mean of 0 and any standard deviation
D) a mean of 0 and a standard deviation of 1
Answer: D
Explanation: By definition, the standard normal probability distribution has a mean of 0 and a
standard deviation of 1.
Difficulty: 1 Easy
Bloom's: Understand
21
49) The weekly mean income of a group of executives is $1,000 and the standard deviation of
this group is $100. The distribution is normal. What percent of the executives have an income of
$925 or less?
A) About 15%
B) About 85%
C) About 50%
D) About 23%
Answer: D
Explanation: Begin by finding the z-value corresponding to $925. From z = (x − μ)/σ:
z = (x − μ)/σ = (925 – 1,000)/100 = −0.75. Then, using the "areas under the normal curve" table,
the probability z is less than −0.75 is 0.2266 from 0.5000 − 0.2734. Converting to percentages
and rounding 0.2266 is 23%.
Bloom's: Apply
AACSB: Analytic
50) The weight of cans of fruit is normally distributed with a mean of 1,000 grams and a
standard deviation of 50 grams. What percent of the cans weigh 860 grams or less?
A) 0.0100
B) 0.8400
C) 0.0026
D) 0.0001
Answer: C
Explanation: Begin by finding the z-value corresponding to 860 grams. From z = (x − μ)/σ:
z = (x − μ)/σ = (860 − 1,000)/50 = −2.8. Then, using the "areas under the normal curve" table, the
probability z is less than −2.8 is 0.0026 from 0.5000 − 0.4974.
Bloom's: Apply
AACSB: Analytic
22
51) What is a normal distribution with a mean of 0 and a standard deviation of 1 called?
A) Frequency distribution
B) Z-score
C) Standard normal distribution
D) Binomial probability distribution
Answer: C
Explanation: The standard normal probability distribution has a mean of 0 and a standard
deviation of 1.
Difficulty: 1 Easy
Bloom's: Remember
52) The seasonal output of a new experimental strain of pepper plants was carefully weighed.
The mean weight per plant is 15.0 pounds, and the standard deviation of the normally distributed
weights is 1.75 pounds. Of the 200 plants in the experiment, how many produced peppers
weighing between 13 and 16 pounds?
A) 100
B) 118
C) 197
D) 53
Answer: B
Explanation: Begin by finding the z-values corresponding to 13 and 16 pounds. They are −1.14,
found by: z = (x − μ)/σ: z = (x − μ)/σ = (13 − 15)/1.75 and 0.57, found by: z = (x − μ)/σ: z = (x −
μ)/σ = (16 − 15)/1.75. Then, the probability or proportion of the plants is between (−1.14) and
0.57 is 0.5886 by adding 0.3729 and 0.2157. Remember, because the normal distribution is
symmetric, the area between 0 and a negative z-value is the same as that between 0 and the
corresponding positive z-value. This means 58.86% of the peppers weigh between 13 and 16
pounds. Finally, you can conclude that 118 plants produced the desired weights by multiplying
200 by 0.5886.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
23
53) Ball-Bearings, Inc. produces ball bearings automatically on a Kronar BBX machine. For one
of the ball bearings, the mean diameter is set at 20.00 mm (millimeters). The standard deviation
of the production over a long period of time was computed to be 0.150 mm. What percent of the
ball bearings will have diameters of 20.27 mm or more?
A) 41.00%
B) 12.62%
C) 3.59%
D) 85.00%
Answer: C
Explanation: Begin by finding the z-value corresponding to 20.27 mm. From z = (x − μ)/σ:
z = (x − μ)/σ = (20.27 − 20.00)/0.15 = 1.8. Then, using the "areas under the normal curve" table,
find the probability z is more than 1.8 is 0.0359 from 0.5000 − 0.4641. Expressing 0.0359 as a
percentage is 3.59%.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
54) A national manufacturer of unattached garages discovered that the distribution of the time for
two construction workers to erect the Red Barn model is normally distributed with a mean of 32
hours and a standard deviation of 2 hours. What percent of the garages take between 32 and 34
hours to erect?
A) 16.29%
B) 76.71%
C) 3.14%
D) 34.13%
Answer: D
Explanation: Begin by finding the z-value corresponding to 34 hours. From z = ((x − μ)/σ):
z = (x − μ)/σ = (34 − 32)/2 = 1.0. Then, find the probability that z is between 0 and 1 is 0.3413 or
34.13% from the "areas under the normal curve" table.
Bloom's: Apply
AACSB: Analytic
24
55) A large manufacturing firm tests job applicants. Test scores are normally distributed with a
mean of 500 and a standard deviation of 50. Management is considering placing a new hire in an
upper-level management position if the person scores in the upper sixth percent of the
distribution. What is the lowest score a new hire must earn to qualify for a responsible position?
A) 50
B) 625
C) 460
D) 578
Answer: D
Explanation: Recall that the area under the normal curve to the right of the mean is 0.5000. The
area between the mean and the desired "cutoff" score is 0.4400, found by 0.5000 − 0.0600. Now
refer to the "areas under the normal curve" table. Search the body of the table for the area closest
to 0.4400. The closest area is 0.4406. Move to the margins from this value and read the z-value
of 1.56. Finally, the lowest score a new hire must earn to qualify is 578, found by:
score x + zσ = 500 + 1.56(50).
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
56) An analysis of the grades on the first test in History 101 revealed that they approximate a
normal curve with a mean of 75 and a standard deviation of 8. The instructor wants to award the
grade of A to the upper 10% of the test grades. To the nearest percent, what is the dividing point
between an A and a B grade?
A) 80
B) 85
C) 90
D) 95
Answer: B
area between the mean and the dividing point is 0.4000, found by 0.5000 − 0.1000. Now refer to
the "areas under the normal curve" table. Search the body of the table for the area closest to
0.4000. The closest area is 0.3997. Move to the margins from this value and read the z-value of
1.28. Finally, the dividing point is 85.24, found by: score = x + zσ = 75 + 1.28(8).
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
25
57) The annual commissions per salesperson employed by a retailer of mobile communication
devices averaged $40,000, with a standard deviation of $5,000. What percent of the salespersons
earn between $32,000 and $42,000?
A) 60.06%
B) 39.94%
C) 34.13%
D) 81.66%
Answer: A
Explanation: Begin by finding the z-values corresponding to $32,000 and $42,000. They are
−1.6, found by z = (x − μ)/σ = (32,000 − 40,000)/5,000 and 0.4, found by
z = (x − μ)/σ = (42,000 − 40,000)/5,000. Then, you find the probability or proportion of the
commissions between −1.6 and 0.4 by adding 0.4452 and 0.1554, or 0.6006, or 60.06%. This
means 60.06% of the commissions are between $32,000 and $42,000. Remember, because the
normal distribution is symmetric, the area between 0 and a negative z-value is the same as that
between 0 and the corresponding positive z-value.
Bloom's: Apply
AACSB: Analytic
58) The mean of a normal probability distribution is 500 and the standard deviation is 10. About
95% of the observations lie between what two values?
A) 475 and 525
B) 480 and 520
C) 400 and 600
D) 350 and 650
Answer: B
within two standard deviations of the mean. The two values are 480 and 520, found by 500 −
2(10) and 500 + 2(10).
Bloom's: Apply
AACSB: Analytic
26
59) A cola-dispensing machine is set to dispense a mean of 2.02 liters into a container labeled 2
liters. Actual quantities dispensed vary, and the amounts are normally distributed with a standard
deviation of 0.015 liters. What is the probability a container will have less than 2 liters?
A) 0.0918
B) 0.3413
C) 0.1926
D) 0.8741
Answer: A
Explanation: Begin by finding the z-value corresponding to 2 liters. From z = (x − μ)/σ =
(2 − 2.02)/0.015 = −1.33. Then, the probability z is less than −1.33 equals 0.0918, found by
computing 0.5000 − 0.4082.
Bloom's: Apply
AACSB: Analytic
60) The employees of Cartwright Manufacturing are awarded efficiency ratings. The distribution
of the ratings approximates a normal distribution. The mean is 400, the standard deviation is 50.
What is the area under the normal curve between 400 and 482?
A) 0.5000
B) 0.4495
C) 0.3413
D) 0.4750
Answer: B
Explanation: Begin by finding the z-value corresponding to 482. From z = (x − μ)/σ =
(482 − 400)/50 = 1.64. Then, the probability z is between 0 and 1.64 equals 0.4495, found by
using the "areas under the normal curve" table.
Bloom's: Apply
AACSB: Analytic
27
61) Suppose a tire manufacturer wants to set a mileage guarantee on its new XB 70 tire. Tests
revealed that the tire's mileage is normally distributed with a mean of 47,900 miles and a
standard deviation of 2,050 miles. The manufacturer wants to set the guaranteed mileage so that
no more than 5% of the tires will have to be replaced. What guaranteed mileage should the
manufacturer announce?
A) 44,518
B) 32,960
C) 49,621
D) 40,922
Answer: A
Explanation: Recall that the area under the normal curve to the left of the mean is 0.5000. The
1.65. Finally, the guaranteed mileage is 44,518, found by mileage = x + zσ = 47,900 −
1.65(2,050).
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
62) Customers of the Key Refining Company charge an average of $70 per month. The
distribution of amounts charged is approximately normal, with a standard deviation of $10. What
is the probability of selecting a credit card customer at random and finding the customer charged
between $70 and $83?
A) 0.1962
B) 0.4032
C) 0.3413
D) 0.4750
Answer: B
Explanation: Begin by finding the z-value corresponding to $83, from z = (x − μ) ⁄ σ =
(83 − 70)/10 = 1.3. Then, the probability z is between 0 and 1.3 equals 0.4032, found by using
the "areas under the normal curve" table.
Bloom's: Apply
AACSB: Analytic
28
63) Management is considering a bonus system to increase production. One suggestion is to pay
a bonus on the highest 5% of production based on past experience. Past records indicate that an
average of 4,000 units of a small assembly is produced during a week. The distribution of the
weekly production is approximately normally distributed with a standard deviation of 60 units. If
the bonus is paid on the upper 5% of production, the bonus will be paid on how many units or
more?
A) 6,255
B) 5,120
C) 3,196
D) 4,099
Answer: D
1.65. Finally, the dividing point is 4,099, found by: top 5% production = x + zσ = 4,000 +
1.65(60).
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
64) The average score of 100 students taking a statistics final was 70, with a standard deviation
of 7. Assuming a normal distribution, what is the probability that a student scored 90 or higher?
A) 0.4979
B) 0.0021
C) 0.9979
D) 2.86
Answer: B
Explanation: Begin by finding the z-value corresponding to 90. From z = (x − μ)⁄σ = (90 − 70)/7
= 2.86. Then, using the "areas under the normal curve" table, the probability z is greater than
2.86 equals 0.0021, found by computing 0.5000 − 0.4979.
Bloom's: Apply
AACSB: Analytic
29
65) The average score of 100 students taking a statistics final was 70 with a standard deviation of
7. Assuming a normal distribution, what is the probability that a student scored greater than 65?
A) 0.2611
B) 0.2389
C) 0.7611
D) −0.714
Answer: C
Explanation: Begin by finding the z-value corresponding to 65, from z = ((x − μ)⁄σ):
z = (65 − 70)/7 = −0.71. Then, using the "areas under the normal curve" table, find the
probability z is greater than −0.71 equals 0.7611 by computing 0.5000 + 0.2611.
Bloom's: Apply
AACSB: Analytic
66) The average score of 100 students taking a statistics final was 70, with a standard deviation
of 7. Assuming a normal distribution, what test score separates the top 5% of the students from
the lower 95% of the students?
A) 81.55
B) 90.00
C) 83.72
D) 78.96
Answer: A
Explanation: Recall the area under the normal curve to the right of the mean is 0.5000. The area
between the mean and the dividing point is 0.4500, found by 0.5000 − 0.0500. Now refer to the
"areas under the normal curve" table. Search the body of the table for the area closest to 0.4500.
The closest area is 0.4505. Move to the margins from this value and read the z-value of 1.65.
Finally, the dividing point is 81.55, found by: score of top 5% = x + zσ = 70 + 1.65(7).
Bloom's: Apply
AACSB: Analytic
30
67) The average score of 100 students taking a statistics final was 70 with a standard deviation of
7. Assuming a normal distribution, what test score separates the top 25% of the students from the
lower 75% of students?
A) 70.00
B) 74.69
C) 65.31
D) 75.25
Answer: B
0.67. Finally, the dividing point is 74.69, found by: score of the top 25% = x + zσ = 70 + 0.67(7).
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
68) A binomial distribution has 100 trials (n = 100) with a probability of success of 0.25 (π =
0.25). To apply the normal distribution to approximate the binomial, what are the mean and
standard deviation?
A) µ= 100 and σ = 0.25
B) µ = 25 and σ = 100
C) µ = 25 and σ = 4.33
D) µ= 100 and σ = 2500
Answer: C
Explanation: Calculate the mean = nπ = 25 and σ = square root of [nπ(1 − π)] = 4.33.
Difficulty: 1 Easy
Bloom's: Apply
AACSB: Analytic
31
69) A binomial distribution has 50 trials (n = 50) with a probability of success of 0.50 (π = 0.50).
To use the normal distribution to approximate the binomial, what are the mean and standard
deviation?
A) µ = 25 and σ = 3.5355
B) µ = 25 and σ = 12.5
C) µ = 25 and σ = 4.33
D) µ = 50 and σ = 100
Answer: A
Explanation: Calculate the mean = nπ = 25 and σ = square root of [nπ(1 − π)] = 3.5355.
Difficulty: 1 Easy
Bloom's: Apply
AACSB: Analytic
0.25). We would like to find the probability of 75 or more successes using the normal
distribution to approximate the binomial. Applying the continuity correction factor, what value
would be used to calculate a z-score?
A) 74.5
B) 75
C) 75.5
D) 25
Answer: A
Explanation: Here we are calculating the probability of 75 or more successes, which is the same
as "at least" 75, so we subtract 0.5 from 75 and use 74.5 to calculate the z-score. In effect, we are
letting the probability that X = 75 lies between 74.5 and 75.5, and since we want to include 75 in
calculating the probability, we start at the lower end of this range.
Bloom's: Apply
AACSB: Analytic
32
0.25). We would like to find the probability of 34 or more successes using the normal
distribution to approximate the binomial. Applying the continuity correction factor, what z-score
should be used?
A) 2.079
B) 2.194
C) 1.963
D) 0.25
Answer: C
as "at least" 34, so we subtract 0.5 from 34 and use 33.5 to calculate the z-score. To calculate the
z-score, we also need the mean and standard deviation, which are μ = nπ = (100)(.25) = 25 and
σ= = = 4.33. Therefore, z = (33.5 − 25)/4.33 = 1.963.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
72) A binomial distribution has 50 trials (n = 50) with a probability of success of 0.50 (π = 0.50).
We would like to find the probability of 34 or more successes using the normal distribution to
approximate the binomial. Applying the continuity correction factor, what z-score should be
used?
A) 2.404
B) 2.546
C) 2.687
D) 0.50
Answer: A
as "at least" 34, so we subtract 0.5 from 34 and use 33.5 to calculate the z-score. To calculate the
z-score, we also need the mean and standard deviation, which are μ = nπ = (50)(0.5) = 25 and
σ= = = 3.536. Therefore, z = (33.5 – 25)/3.536 = 4.404.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
33
73) If an average of 12 customers are served per hour, then one customer arrives every
________.
A) 12 minutes
B) 60 minutes
C) 5 minutes
D) 10 minutes
Answer: C
Explanation: Rate per hour = 12 customers. Then, 60/12 = 5 minutes.
Difficulty: 1 Easy
Bloom's: Apply
AACSB: Analytic
74) If an average of 60 customers are served per hour, then one customer arrives every
________.
A) 1 minute
B) 60 minutes
C) 12 minutes
D) 10 minutes
Answer: A
Explanation: Rate per hour = 60 customers. 60 minutes divided by 60 customers = 1 customer
per minute.
Difficulty: 1 Easy
Bloom's: Apply
AACSB: Analytic
34
75) If an average of 12 12 customers are served per hour, what is the probability that the next
customer will arrive in 6 minutes or less?
A) 0.61
B) 0.30
C) 0.70
D) 0.39
Answer: C
Explanation: µ = 12 customers per hour; then, λ = 12/60 = 0.2. P(arrival time ≤ 6 minutes) =
0.6988 ≈ 0.70. Use the Excel statistical formula to find the cumulative function or formula 7 − 7
in your textbook.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
76) If an average of 12 customers are served per hour, what is the probability that the next
customer will arrive in 3 minutes or less?
A) 0.55
B) 0.30
C) 0.45
D) 0.39
Answer: C
Explanation: µ = 12 customers per hour; then, λ = 12/60 = 0.2. P(arrival time ≤ 3 minutes) =
0.4512 ≈ 0.45. Use the Excel statistical formula to find the cumulative function or formula 7 − 7
in your textbook.
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
35
77) The center of a normal probability distribution is ________.
A) the same as the standard deviation or the distribution
B) never negative
C) the mean of the distribution
D) always equal to zero
Answer: C
Explanation: The center of any normal probability distribution is the mean, which is also equal
to the median and mode.
Difficulty: 1 Easy
Bloom's: Understand
78) The z-value for a standard normal distribution ________.

A) is always positive
B) is always equal to zero
C) can be either positive or negative
D) is always equal to the value of the population mean
Answer: C
Explanation: Z-values are negative when X is below the mean, equal to zero when X is equal to
the mean, and positive when X is above the mean.
Difficulty: 1 Easy
Bloom's: Understand
36
79) Consider a continuous random variable x, which is uniformly distributed between 65 and 85.
The probability of x taking on a value between 75 to 90 is ________.
A) 0.75
B) 1.00
C) 0.50
D) 0.075
Answer: C
Explanation:
P(x) = [1/(b − a)] = 1/(85 − 65) = 1/20; P(75 ≤ x ≤ 90) = (1/20) × (85 − 75) = 10/20 = 0.5.
probabilities.
Bloom's: Apply
AACSB: Analytic
80) Consider a standard normal random variable z. What is the value of z if the area to the right
of z is 0.2643?
A) 0.72
B) 0.28
C) 1.46
D) 0.63
Answer: D
Explanation: The area to the right of z is 0.2643. The area from mean 0 to the point in question
is 0.50 − 0.2643 = 0.2357. The z-value corresponding to an area of 0.2357 is z = 0.63. (Use areas
under the normal curve.)
Bloom's: Apply
AACSB: Analytic
37
81) The average starting salary of individuals with a master's degree in statistics is normally
distributed with a mean of $48,000 and a standard deviation of $6,000. What is the probability
that a randomly selected individual with a master's in statistics will get a starting salary of at least
$55,000?
A) 0.121
B) 0.891
C) 0.379
D) 0.098
Answer: A
Explanation: P(X ≥ $55,000). Determine the z-value: z = (X − μ)/σ = (55,000 − 48,000)/6,000 =
1.17. P(z ≥ 1.17) = 0.50 − 0.3790 = 0.121. (Use areas under the normal curve.)
Bloom's: Apply
AACSB: Analytic
82) A college professor noted that the grades of his students in an introductory statistics class
were normally distributed with a mean of 76.5 and a standard deviation of 9. If 67.36% of his
students received grades of C or above, what is the minimum score of those students receiving a
grade of at least a C?
A) 67.36
B) 72.45
C) 66.56
D) 70.00
Answer: B
Explanation: The area corresponding to the students receiving a C or above is 0.6736. The area
to the left of mean 0 is then 0.1736. The z-value corresponding to an area of 0.1736 is z = 0.45.
μ ± zσ = (76.5 ± 0.45(9)) = [72.45, 80.55].
Difficulty: 3 Hard
Bloom's: Apply
AACSB: Analytic
38

Lind18e Chapter07 TB AnswerKey

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Lind18e Chapter07 TB AnswerKey

Uploaded by

Copyright:

Available Formats

Statistical Techniques in Business and Economics, 18e (Lind)

Chapter 7 Continuous Probability Distributions

values, then μ = and σ = .

2) For a uniformly distributed random variable, x, P(x) is constant.

3) For a uniformly distributed random variable, x, P(x) = 1/(b − a).

6) Some normal probability distributions are positively skewed.

11) The number of different standard normal distributions is unlimited.

17) The mean of any uniform probability distribution is ________.

31) What is the probability that z is between 0.0 and 2.0?

33) Which of the following is a characteristic of the normal probability distribution?

45) A normally distributed random variable has ________.

46) The total area of a normal probability distribution is ________.

78) The z-value for a standard normal distribution ________.

You might also like