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Understanding Normal Distribution

The normal distribution is a continuous probability distribution that describes how data clusters around the mean. The normal distribution is symmetric and bell-shaped, with the mean, median, and mode all being equal. Approximately 68% of data falls within one standard deviation of the mean, 95% within two standard deviations, and 99.7% within three standard deviations. The standard normal distribution has a mean of 0 and standard deviation of 1. It is used to transform normally distributed data into z-scores in order to determine probabilities and proportions.

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37 views4 pages

Understanding Normal Distribution

The normal distribution is a continuous probability distribution that describes how data clusters around the mean. The normal distribution is symmetric and bell-shaped, with the mean, median, and mode all being equal. Approximately 68% of data falls within one standard deviation of the mean, 95% within two standard deviations, and 99.7% within three standard deviations. The standard normal distribution has a mean of 0 and standard deviation of 1. It is used to transform normally distributed data into z-scores in order to determine probabilities and proportions.

Uploaded by

Aejohn Miller
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© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Lesson 3.

2 | Normal Distribution

The normal distribution (Gaussian distribution) is a continuous probability distribution that describes the
values in a data set that clusters about the mean. The graph of the Gaussian distribution is a normal
curve defined by the density function

Abraham de Moivre (1667-1754) devised the normal curve mathematically in 1733 as an approximation
to the binomial distribution. Karl Pearson (1857-1936) discovered his work in 1924. Pierre-Simon Laplace
(1749-1827) then used the normal curve to describe the distribution of errors in 1783. During 1809, Carl
Friedrich Gauss (1777-1855) utilized the normal curve in analyzing data in astronomy. In the modern
times, the normal curve also known as the bell-shaped curve plays its important role in modeling real
life problem applications involving normal data values.

The normal curve has the following characteristics that allow users to estimate the probability of
occurrence of a phenomenon represented by the value of a normally distributed factors.

a. The distribution is bell-shaped.

b. The normal curve is symmetric about the mean.

c. The mean, median and the mode values coincide.

d. The total area under the curve is 1 or 100%.

e. The area that fall within 1 standard deviation of the mean is 68%, within 2 standard deviation,
about 95%, and with 3 standard deviation is 99.7%.

The figure below shows the area specified for each region.
Example: A survey of 200 rice distribution outlets in the province found that the selling price per sack of
rice is approximately normally distributed with a mean of Php 2250 and a standard deviation of Php 25.
How many rice distribution outlets that sells

i) less than Php 2,200 per sack of rice?

ii) between Php 2,225 and Php 2,275 per sack of rice?

iii) more than Php 2,275 per sack of rice?

Solution:

a. The Php 2,200 selling price per sack of rice is 2 standard deviations below the mean. Since 47.7% of all
the data falls between the mean and 2 standard deviation below the mean,

(47.7%) (200)=(0.477)(200)=95

of the distribution outlets sells between Php 2,200 and the mean price of Php 2,250 per sack of rice.
However, half of the 200 sacks of rice have prices less than the mean price of Php 2,250. Thus, the
number of distribution outlets that sells less than Php 2,200 price per sack is 100-95=5 sacks of rice.

b. The Php 2,225 selling price per sack of rice is 1 standard deviation below the mean while the price of
Php 2,275 is at 1 standard deviation above the mean. For a normal distribution, 68% of all the data lie
within 1 standard deviation about the mean. Hence, approximately, (68%) (200)=(0.68)(200)=136
distribution outlets sells between Php 2,225 and Php 2,275 per sack of rice.

c. The selling price of Php 2,275 per sack of rice is 1 standard deviations above the mean. In a normal
distribution, 68% of all the data falls within 1 standard deviation about the mean. This implies that 32%
of the data will fall either less than 1 standard deviation below the mean or more than 1 standard
deviation above the mean. Thus, the 16% of the data that are 1 standard deviation above the mean is
(16%)(200)=(0.16)(200)=32 distribution outlets.

The Standard Normal Distribution

The standard normal distribution is a probability distribution that has a mean of 0 and a standard
deviation of 1. Such distribution is a result of the transformation wherein the normally distributed x-
scores are transformed into z – scores through the formula:

Example: The average age of marketing supervisors is 38 years old. Assume that the data are normally
distributed. If the standard deviation is 6 years old, find the proportion of marketing supervisors whose
age are between 35 years old and 42 years old.

Solution: The standard z - scores for 35 and 42 years old x-scores are computed as

This means that 30.85% of the data lies below z=-0.50 while 74.86% of the data values fall below z=0.67.
Since the proportion of marketing managers to be determined is between 35 years old and 42 years old
or equivalently between z=-0.50 and z=0.67, then 74.86% - 30.85% = 44.01%. Thus, the proportion of
marketing managers whose age is between 35 and 42 years old is 44.01%.

Remark: The proportion of values bounded by z-scores under the standard normal curve can also be
determined using the z table depicting the area under the standard normal curve. The notion of
proportion can also be thought as percentage, probabilities or areas when dealing with problems
involving the approximately or normally distributed data values.

Explore:

1. Using the excel “NORMSDIST” function find

a. the proportion of marketing managers whose age are greater than 38 years old.
b. the percentage of marketing managers whose age are less than 40 years old.

2. Verify the results obtained in 1-a and 1-b using the z-table.

Some online resources:

[Link]
j0l3j69i61.3905j0j7&sourceid=chrome&ie=UTF-8#

The Normal Distribution and the 68-95-99.7 Rule (5.2). Retrieved


at: [Link]

Random Variables and Discrete Probability Distributions. Retrieved


at: [Link]

Common questions

Powered by AI

The standard deviation measures the spread of data around the mean in a normal distribution. Using the empirical rule, it is known that approximately 68% of data falls within 1 standard deviation, 95% within 2, and 99.7% within 3. By identifying the mean and standard deviation, one can calculate specific cutoff points (e.g., one standard deviation below the mean) to predict how many values lie within those ranges, aiding in data analysis and decision-making .

The normal distribution is defined by several key characteristics: it is bell-shaped and symmetric about the mean, the mean, median, and mode coincide, the total area under the curve is 1 or 100%, and specific percentages of data fall within standard deviations from the mean (68% within 1, 95% within 2, and 99.7% within 3). These characteristics facilitate probability estimation by allowing predictions about the likelihood of a value occurring within certain intervals based on the standard deviation and mean of the data set .

A probability distribution with a total area of 1 ensures that every possible outcome is accounted for within the distribution. In the context of normally distributed datasets, this property allows for straightforward probability calculations as it guarantees that the sum of probabilities over all possible outcomes equals 1. Probabilities for specific events or ranges can thereafter be easily calculated by determining the area under the curve for those intervals .

Z-scores, which reflect how many standard deviations a data point is from the mean, are crucial for analyzing variations within a dataset. By converting raw scores to z-scores, one gains insights into a data point's relative position, helping to identify outliers and compare differing datasets on a common scale. This aids in effective decision-making and interpretation of data by providing a standardized measurement of deviation .

LaPlace's work using the normal distribution to calculate errors and Gauss’s application in astronomical data analysis laid pivotal foundations for modern statistics. Their contributions allowed the development of theories and methodologies that are integral to fields like econometrics and psychological testing today, showcasing how their foundational work has facilitated advancements in data analysis and probabilistic forecasting, underscoring the enduring impact on modern statistical practice .

The 68-95-99.7 rule indicates the percentage of data that falls within 1, 2, and 3 standard deviations from the mean, respectively, and is instrumental in understanding the distribution and variability of data in a normal distribution. This rule helps in practical data analysis by providing quick and intuitive guidelines for assessing the likelihood of events, identifying outliers, and making statistical predictions, thereby enhancing the accuracy and reliability of analyses across various applications .

Pierre-Simon Laplace used the normal curve to describe the distribution of errors in 1783, focusing on reducing and understanding errors in observations. Carl Friedrich Gauss later applied the curve in astronomy to analyze and interpret positional data, emphasizing its utility in practical and predictive applications. While both contributed to the curve’s theoretical underpinnings, their objectives were tailored to their disciplines—Laplace in probability theory and errors, and Gauss in empirical measurements and analysis .

The standard normal distribution transforms normally distributed data into a distribution with a mean of 0 and a standard deviation of 1 using z-scores. This transformation allows comparisons between different data sets and enables general probability calculations without needing the data’s original mean or standard deviation, making it a foundational tool in statistical analysis for standardization across various contexts .

The bell-shaped curve of a normal distribution is central to statistical modeling as it succinctly represents the distribution where most data points cluster around the mean, with symmetrical tapering on both ends. This symmetry and concentration of data near the mean allow for reliable predictions and interpretations regarding the likelihood of events, thus aiding in various fields like finance, psychology, and natural sciences for understanding and predicting real-world phenomena .

The Gaussian distribution was mathematically devised by Abraham de Moivre as an approximation to the binomial distribution in 1733, with Pierre-Simon Laplace and Carl Friedrich Gauss playing significant roles in its development and use in describing errors and data analysis respectively. In modern times, it is extensively used in fields such as astronomy, economics, and statistics to model real-life phenomena, leveraging its predictive power for normally distributed data .

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