Computing Probabilities and Percentiles Using the Normal Distribution
Understanding how household income is distributed within a community is essential for effective
social work practice, particularly when planning resource allocation. In this scenario, household
income in a rural, underprivileged community follows a Normal Distribution with a mean (μ) of
$3,000 and a standard deviation (σ) of $500. Using the Z-score formula, we can calculate the
probability that a family's income falls below a specific threshold and determine the percentile
rank of a given income level within the distribution (Illowsky et al., 2023).
Question 1: Probability of Income Below $2,500
The Z-score standardizes a raw value by measuring how many standard deviations it falls from
the mean. The formula is:
Z = (x − μ) / σ
Substituting the given values, where x = 2,500, μ = 3,000, and σ = 500:
Z = (2,500 − 3,000) / 500 = −500 / 500 = −1.00
A Z-score of −1.00 indicates that an income of $2,500 falls exactly one standard deviation below
the mean. Referring to the standard normal table, the area to the left of Z = −1.00 is 0.1587
(University of Arizona, n.d.). This value represents P(Z < −1.00), which is the cumulative
probability of a family earning less than $2,500.
P(X < 2,500) = P(Z < −1.00) = 0.1587
This means there is approximately a 15.87% probability that a randomly selected family in this
community has an income below $2,500. From a resource-allocation standpoint, this suggests
that roughly 16 out of every 100 families fall below this threshold and may need additional
financial support or targeted assistance programs.
Question 2: Z-score and Percentile Rank for an Income of $3,500
Using the same formula with x = 3,500, μ = 3,000, and σ = 500:
Z = (3,500 − 3,000) / 500 = 500 / 500 = 1.00
A Z-score of 1.00 means an income of $3,500 is one standard deviation above the mean.
Looking up Z = 1.00 in the standard normal table gives an area of 0.8413 to the left of this value
(University of Arizona, n.d.), which represents the cumulative probability, or percentile rank:
P(X < 3,500) = P(Z < 1.00) = 0.8413 → 84.13th percentile
This indicates that a family earning $3,500 has a higher income than approximately 84.13% of
families in the community, placing them in roughly the 84th percentile of the income
distribution.
Conclusion
These calculations demonstrate how the properties of the Normal Distribution can transform raw
income data into actionable insights. By converting dollar values into Z-scores, a social worker
can quickly identify what proportion of families fall below a critical income threshold (15.87%
below $2,500) and how a specific family's income compares to the rest of the community (84th
percentile for $3,500). Such statistical tools support evidence-based decision-making when
designing and targeting resource-allocation programs for underserved populations.
References
Illowsky, B., Dean, S., Birmajer, D., Blount, B., Boyd, S., Einsohn, M., Helmreich, J., Kenyon,
L., Lee, S., & Taub, J. (2023). Introductory statistics 2e. OpenStax.
[Link]
University of Arizona. (n.d.). Standard normal distribution: Table values represent the area to
the left of the Z score [PDF]. Retrieved September 5, 2025, from
[Link]