Doane - Stats - Chap 007 - Test Answers

Chapter 07
Continuous Probability Distributions
True / False Questions

1. A continuous uniform distribution is always symmetric.
True
False
2. The height and width of a continuous uniform distribution's PDF are the
same.
True
False
3. A continuous uniform distribution U(0,800) will have = 400 and =

230.94.
True
False
4. A continuous uniform distribution U(100,200) will have the same

standard deviation as a continuous uniform distribution U(200,300).
True
False
5. For a continuous uniform distribution U(200,400), the parameters are

= 300 and = 100.
True
False
6. The exponential distribution describes the number of arrivals per unit of

time.
True
False
7. The exponential distribution is always skewed right.

True
False
8. If arrivals follow a Poisson distribution, waiting times follow the

exponential distribution.
True
False
9. The triangular distribution is used in "what-if" analysis for business

planning.
True
False
10 The triangular distribution is symmetric.

.
True False
11 The triangular distribution T(0,10,20) is skewed left.
.
True False
12 A triangular distribution can be skewed either left or right.
.
True False
13 For a continuous random variable, the total area beneath the PDF will
. be greater than zero but less than one.
True
False
14 The exponential distribution is continuous and the Poisson distribution

. is discrete, yet the two distributions are closely related.
True
False
15 The mean, median, and mode of a normal distribution will always be

. the same.
True
False
16 There is a simple formula for normal areas, but we prefer a table for
. greater accuracy.
True
False
17 Normal distributions differ only in their means and variances.

.
True False
18 Any normal distribution has a mean of 0 and a standard deviation of 1.
.
True False
19 We would use a normal distribution to model the waiting time until the
. next Florida hurricane strike.
True
False
20 Experience suggests that 4 percent of all college students have had a

. tonsillectomy. In a sample of 300 college students, we need to find the
probability that at least 10 have had a tonsillectomy. It is acceptable to
use the normal distribution to estimate this probability.
True
False
21 The normal is a good approximation to the binomial when n is greater

. than or equal to 10.
True
False
22 The true proportion of accounts receivable with some kind of error is 4

. percent for Venal Enterprises. If an auditor randomly samples 50
accounts receivable, it is acceptable to use the normal approximation to
estimate the probability that fewer than two will contain errors.
True
False
23 The normal distribution is a good approximation to the binomial if both

. 10 and n 10.
True
False
24 The normal distribution is a good approximation to the binomial if n =

. 200 and = .03.
True
False
25 The normal distribution is a good approximation to the binomial if n =

. 25 and = .50.
True
False
26 The exponential distribution can be either right-skewed or left-skewed,

. depending on .
True
False
27 The number of lightning strikes in a day in Miami is a continuous

. random variable.
True
False
28 The area under a normal curve is 1 only if the distribution is

. standardized N(0,1).
True
False
29 The area under an exponential curve can exceed 1 because the

. distribution is right-skewed.
True
False
Multiple Choice Questions

30 A machine dispenses water into a glass. Assuming that the amount of
. water dispensed follows a continuous uniform distribution from 10
ounces to 16 ounces, the average amount of water dispensed by the
machine is:
A.
B.
C.
D.
12 ounces.
13 ounces.
14 ounces.
16 ounces.

ounces to 16 ounces, the standard deviation of the amount of water
dispensed is about:
A.
B.
C.
D.
1.73 ounces.
3.00 ounces.
0.57 ounce.
3.51 ounces.

ounces to 16 ounces, what is the probability that 13 or more ounces will
be dispensed in a given glass?
A.
B.
C.
D.
.1666
.3333
.5000
.6666
33 A random variable X is best described by a continuous uniform

. distribution from 20 to 45 inclusive. The mean of this distribution is:
A.
B.
C.
D.
30.5.
31.5.
32.5.
33.5.

. distribution from 20 to 45 inclusive. The standard deviation of this
distribution is approximately:
A.
B.
C.
D.
52.1.
32.5.
6.85.
7.22.

. distribution from 20 to 45 inclusive. What is P(30 X 40)?
A.
B.
C.
D.
.20
.40
.60
.80
36 The Excel function =800*RAND() would generate random numbers with

. standard deviation approximately equal to:
A.
B.
C.
D.
200.
188.
231.
400.
37 The Excel function =40*RAND() would generate random numbers with

. standard deviation approximately equal to
A.
B.
C.
D.
13.33.
20.00.
11.55.
19.27.
38 If arrivals occur at a mean rate of 3.6 events per hour, the exponential
. probability of waiting more than 0.5 hour for the next arrival is:
A.
B.
C.
D.
.2407.
.1653.
.1222.
.5000.
39 If arrivals occur at a mean rate of 3.6 events per hour, the exponential
. probability of waiting less than 0.5 hour for the next arrival is:
A.
B.
C.
D.
.7122.
.8105.
.8347.
.7809.
40 If arrivals occur at a mean rate of 2.6 events per minute, the

. exponential probability of waiting more than 1.5 minutes for the next
arrival is:
A.
B.
C.
D.
.0202.
.0122.
.0535.
.2564.
41 If arrivals occur at a mean rate of 1.6 events per minute, the

. exponential probability of waiting less than 1 minute for the next arrival
is:
A.
B.
C.
D.
.2019.
.7104.
.8812.
.7981.
42 Bob's z-score for the last exam was 1.52 in Prof. Axolotl's class BIO 417,
. "Life Cycle of the Ornithorhynchus." Bob said, "Oh, good, my score is in
the top 10 percent." Assuming a normal distribution of scores, is Bob
right?
A.
B.
C.
Yes.
No.
Must have n to answer.
43 The lengths of brook trout caught in a certain Colorado stream are

. normally distributed with a mean of 14 inches and a standard deviation
of 3 inches. What proportion of brook trout caught will be between 12
and 18 inches in length?
A.
B.
C.
D.
.6563
.6826
.2486
.4082

of 3 inches. The first quartile for the lengths of brook trout would be:
A.
B.
C.
D.
16.01 inches.
11.00 inches.
11.98 inches.
10.65 inches.

of 3 inches. What lower limit should the State Game Commission set on
length if it is desired that 80 percent of the catch may be kept by
fishers?
A.
B.
C.
D.
12.80 inches
11.48 inches
12.00 inches
9.22 inches
46 In Melanie's Styling Salon, the time to complete a simple haircut is

. normally distributed with a mean of 25 minutes and a standard
deviation of 4 minutes. What percent of customers require less than 32
minutes for a simple haircut?
A.
B.
C.
D.
95.99 percent
99.45 percent
97.72 percent
45.99 percent

deviation of 4 minutes. The slowest quartile of customers will require
longer than how many minutes for a simple haircut?
A.
B.
C.
D.
3(n + 1)/4 minutes

26 minutes
25.7 minutes
27.7 minutes

deviation of 4 minutes. For a simple haircut, the middle 90 percent of
the customers will require:
A.
B.
C.
D.
between 18.4 and 31.6 minutes.

49 The area under the normal curve between z = 0 and z = 1 is

. ______________ the area under the normal curve between z = 1 and z =
2.
A.
B.
C.
less than
greater than
equal to
50 The price-earnings ratio for firms in a given industry follows the normal
. distribution. In this industry, a firm whose price-earnings ratio has a
standardized value of z = 1.00 is approximately in the highest ______
percent of firms in the industry.
A.
B.
C.
D.
16 percent
34 percent
68 percent
75 percent
51 A student's grade on an examination was transformed to a z value of

. 0.67. Assuming a normal distribution, we know that she scored
approximately in the top:
A.
B.
C.
D.
15 percent.
50 percent.
40 percent.
25 percent.
52 The MPG (miles per gallon) for a certain compact car is normally
. distributed with a mean of 31 and a standard deviation of 0.8. What is
the probability that the MPG for a randomly selected compact car would
be less than 32?
A.
B.
C.
D.
0.3944
0.8944
0.1056
0.5596
53 The probability is .80 that a standard normal random variable is

. between -z and +z. The value of z is approximately:
A.
B.
C.
D.
1.28.
1.35.
1.96.
1.45.
54 The time required for a citizen to complete the 2010 U.S. Census "long"
. form is normally distributed with a mean of 40 minutes and a standard
deviation of 10 minutes. What proportion of the citizens will require less
than one hour?
A.
B.
C.
D.
0.4772
0.9772
0.9974
0.9997
deviation of 10 minutes. The slowest 10 percent of the citizens would
need at least how many minutes to complete the form?
A.
B.
C.
D.
27.2
35.8
52.8
59.6
deviation of 10 minutes. What is the third quartile (in minutes) for the
time required to complete the form?
A.
B.
C.
D.
44.75
46.75
47.50
52.50
57 Exam scores were normal in BIO 200. Jason's exam score was one
. standard deviation above the mean. What percentile is he in?
A.
B.
C.
D.
68th
75th
78th
84th
58 Compared to the area between z = 1.00 and z = 1.25, the area

. between z = 2.00 and z = 2.25 in the standard normal distribution will
be:
A.
smaller.
B.
larger.
C.
the same.
D. impossible to compare without knowing and .
59 A large number of applicants for admission to graduate study in
. business are given an aptitude test. Scores are normally distributed
with a mean of 460 and standard deviation of 80. What fraction of
applicants would you expect to have scores of 600 or above?
A.
B.
C.
D.
0.0401
0.4599
0.5401
0.0852

with a mean of 460 and standard deviation of 80. What fraction of the
applicants would you expect to have a score of 400 or above?
A.
B.
C.
D.
0.2734
0.7734
0.7266
0.7500

with a mean of 460 and standard deviation of 80. The top 2.5 percent
of the applicants would have a score of at least (choose the nearest
integer):
A.
B.
C.
D.
606.
617.
600.
646.
62 If the random variable Z has a standard normal distribution, then P(1.25

. Z 2.17) is:
A.
B.
C.
D.
0.0906.
0.9200.
0.4700.
0.3944.
63 If the random variable Z has a standard normal distribution, then P(Z

. -1.37) is:
A.
B.
C.
D.
0.9147.
0.4147.
0.5016.
0.0853.
64 Assume that X is normally distributed with a mean = $64. Given that

. P(X $75) = 0.2981, we can calculate that the standard deviation of X
is approximately:
A.
B.
C.
D.
$20.76.
$13.17.
$5.83.
$7.05.
65 The standard deviation of a normal random variable X is $20. Given

. that P(X $10) = 0.1841. From this we can determine that the mean of
the distribution is equal to:
A.
B.
C.
D.
$13.
$26.
$20.
$28.
66 The random variable X is normally distributed with mean of 80 and

. variance of 36. The 67th percentile of the distribution is:
A.
B.
C.
D.
72.00.
95.84.
90.00.
82.64.
67 The area under the normal curve between the 20th and 70th percentiles
. is equal to:
A.
B.
C.
0.7000.
0.5000.
0.9193.
68 The variable in a normal distribution can assume any value between

.
A.
B.
C.
D.
-3 and +3
-4 and +4
-1 and +1
- and +
69 What are the mean and standard deviation for the standard normal
. distribution?
A.
B.
C.
D.
= 0, = 0
= 1, = 1
= 1, = 0
= 0, = 1
70 Any two normal curves are the same except for their:
.
A.
standard deviations.
B.
means.
C.
standard deviations and means.
D. standard deviations, means, skewness, and kurtosis.
71 Light bulbs are normally distributed with an average lifetime of 1000
. hours and a standard deviation of 250 hours. The probability that a light
bulb picked at random will last less than 1500 hours is about:
A.
B.
C.
D.
97.72 percent.
95.44 percent.
75.00 percent.
68.00 percent.
72 To convert a normally distributed variable X into a standard Z score we

. would:
A. subtract the mean from the original observation and divide the result
by the variance.
B. subtract the mean from the original observation and divide the result
by the standard deviation.
C. add the mean and the original observation, then divide by the
variance.
D. subtract the mean from the standard deviation and divide by the
variance.
73 Regarding continuous probability distributions, which statement is

. incorrect?
A. The triangular distribution may be skewed left or right.

B. The uniform distribution is never skewed.
C. The normal distribution is sometimes skewed.
D. The exponential distribution is always skewed right.
74 Which model best describes your waiting time until you get the next
. nonworking web URL ("This page cannot be displayed") as you click on
various websites for Florida condo rentals?
A.
B.
C.
D.
Triangular
Uniform
Normal
Exponential
75 On average, a major earthquake (Richter scale 6.0 or above) occurs 3

. times a decade in a certain California county. What is the probability
that less than six months will pass before the next earthquake?
A.
B.
C.
D.
.1393
.8607
.0952
.9048
76 If the mean time between in-flight aircraft engine shutdowns is 12,500

. operating hours, the 90th percentile of waiting times to the next
shutdown will be:
A.
B.
C.
D.
20,180 hours.
28,782 hours.
23,733 hours.
18,724 hours.
77 On average, 15 minutes elapse between discoveries of fraudulent

. corporate tax returns in a certain IRS office. What is the probability that
less than 30 minutes will elapse before the next fraudulent corporate
tax return is discovered?
A.
B.
C.
D.
.1353
.6044
.7389
.8647
78 If the mean time between unscheduled maintenance of LCD displays in

. a hospital's CT scan facility is 4,000 operating hours, what is the
probability of unscheduled maintenance in the next 5,000 hours?
A.
B.
C.
D.
.8000
.7135
.2865
.5000
79 A certain assembly line at Vexing Manufacturing Company averages 30

. minutes between breakdowns. What is the probability that less than 6
minutes will elapse before the next breakdown?
A.
B.
C.
D.
.8187
.0488
.1813
.2224
80 A certain assembly line at Vexing Manufacturing Company averages 30

. minutes between breakdowns. The median time between breakdowns
is:
A.
B.
C.
D.
30.0 minutes.
35.7 minutes.
25.4 minutes.
20.8 minutes.
81 Which probability model is most appropriate to describe the waiting

. time (working days) until an office photocopier breaks down (i.e.,
requires unscheduled maintenance)?
A.
B.
C.
D.
Normal
Uniform
Exponential
Poisson
82 Bob's z-score for the last exam was -1.15 in FIN 417, "Capital Budgeting
. Strategies." Bob said, "Yipe! My score is within the bottom quartile."
Assuming a normal distribution, is Bob right?
A.
B.
C.
Yes
No
Must know the class size to answer
83 Exam scores were normal in MIS 200. Jason's exam score was 1.41
. standard deviations above the mean. What percentile is he in?
68th
75th
84th
92nd
A.
B.
C.
D.
84 Compared to the area between z = 0.50 and z = 0.75, the area

. between z = 1.50 and z = 1.75 in the standard normal distribution will
be:
A.
B.
C.
smaller
larger
the same
85 If GMAT scores for applicants at Oxnard Graduate School of Business

. are N(500, 50) then the top 5 percent of the applicants would have a
score of at least (choose the nearest integer):
A.
B.
C.
D.
575.
582.
601.
608.
86 If the random variable Z has a standard normal distribution, then P(1.17

. Z 2.26) is:
A.
B.
C.
D.
0.1091.
0.1203.
0.2118.
0.3944.
87 If the random variable Z has a standard normal distribution, then P(Z

. -1.72) is:
A.
B.
C.
D.
0.9573.
0.0446.
0.5016.
0.0427.
88 Excel's =100*RAND() function produces continuous random numbers

. that are uniformly distributed between 0 and 100. The standard
deviation of this distribution is approximately:
A.
B.
C.
D.
50.00.
28.87.
33.33.
25.00.
89 Excel's =RAND() function produces random numbers that are uniformly

. distributed between 0 and 1. The mean of this distribution is
approximately
A.
B.
C.
D.
.5000
.2500
.3333
.2887
90 Excel's =RAND() function produces random numbers that are uniformly

. distributed from 0 to 1. What is the probability that the random number
exceeds .75?
A.
B.
C.
75 percent
50 percent
25 percent
91 Which is the correct Excel formula for the 80th percentile of a

. distribution that is N(475, 33)?
A.
B.
C.
=NORM.DIST(80, 475, 33,1)

=NORM.INV(0.80, 475, 33)
=NORM.S.INV((80 - 475)/33)
92 If arrivals follow a Poisson distribution with mean 1.2 arrivals per

. minute, find the 75th percentile of waiting times until the next arrival
(i.e., 75 percent below).
A.
B.
C.
1.155 minutes (69.3 seconds)

0.240 minute (14.4 seconds)
93 A software developer makes 175 phone calls to its current customers.

. There is an 8 percent chance of reaching a given customer (instead of a
busy signal, no answer, or answering machine). The normal
approximation of the probability of reaching at least 20 customers is:
A.
B.
C.
D.
.022.
.007.
.063.
.937.
94 For Gardyloo Manufacturing, the true proportion of accounts receivable

. with some kind of error is .20. If an auditor randomly samples 225
accounts receivable, what is the approximate normal probability that 39
or fewer will contain errors?
A.
B.
C.
D.
.1797
.2097
.1587
.0544
95 A letter is mailed to a sample of 500 homeowners. Based on past

. experience, the probability of an undeliverable letter is 0.06. The
normal approximation to the binomial probability of 40 or more
undeliverable letters is:
A.
B.
C.
D.
0.9632
0.0368
0.2305
0.7695
96 In a T-F exam with 100 questions, passing requires a score of at least

. 60. What is the approximate normal probability that a "guesser" will
score at least 60 points?
A.
B.
C.
D.
.0287
.4713
.0251
.0377
97 A multiple choice exam has 100 questions. Each question has five
. choices. What would be the approximate probability that a "guesser"
could achieve a score of 30 or more?
A.
B.
C.
D.
0.0088
0.0062
0.0015
0.4913
98 For which binomial distribution would a normal approximation be most

. acceptable?
A.
B.
C.
D.
n = 50, = 0.05
n = 100, = 0.04
n = 40, = 0.25
n = 400, = 0.02
99 Historically, the default rate on a certain type of commercial loan is 20

. percent. If a bank makes 100 of these loans, what is the approximate
probability that at least 26 will result in default?
A.
B.
C.
D.
0.2000
0.0668
0.0846
0.0336
100 A company employs 300 employees. Each year, there is a 30 percent

.
turnover rate for employees. We want to do a normal approximation to
the binomial distribution of the number of employees who leave each
year. For this normal approximation, the mean is ______ and the
standard deviation is _____.
A.
B.
C.
D.
90, 63
90, 7.937
90, 30
90, 15
101 The probability that a rental car will be stolen is 0.001. If 25,000 cars
.
are rented from Hertz, what is the normal approximation to the
probability that fewer than 20 will be stolen?
A.
B.
C.
D.
.2577
.1335
.1128
.8335
102 If adult male heights are normally distributed with a mean of 180 cm
.
and a standard deviation of 7 cm, how high should an aircraft lavatory
door be to ensure that 99.9 percent of adult males will not have to
stoop as they enter?
A.
B.
C.
D.
195.7 cm
201.6 cm
207.3 cm
201.4 cm
103 TotCo is developing a new deluxe baby bassinet. If the length of a

.
newborn baby is normally distributed with a mean of 50 cm and a
standard deviation of 5 cm, what should be the interior length of the
bassinet to ensure that 99 percent of newborn babies will fit, with a
safety margin of 15 cm on each end of the bassinet?
A.
B.
C.
D.
95.45 cm
85.22 cm
91.63 cm
98.92 cm
104 The triangular distribution T(4, 12, 26) has a mean of:
.
A.
B.
C.
D.
14.
18.
12.
13.
105 The triangular distribution T(0, 10, 20) has a standard deviation of:
.
A.
B.
C.
D.
4.082.
3.775.
3.024.
2.994.
106 The triangular distribution T(5, 23, 62) has a mean of:
.
A.
B.
C.
D.
23.
30.
33.
35.
107 The triangular distribution T(10, 20, 50) has a standard deviation of:
.
A.
B.
C.
D.
9.498.
9.225.
8.498.
7.710.
108 Which statement is incorrect?

.
A. The triangular distribution always has a single mode.
B. The mean of the triangular distribution is (a + b + c)/3.
C. The triangular distribution is right-skewed.
109 Bob used a triangular distribution of T(20, 30, 61) to represent his daily
.
commute time (minutes). Which statement is incorrect?
A.
The distribution is right-skewed.
B. The mode of the distribution exceeds the mean.
C.
The mean of the distribution is 37.
D. The midrange of the distribution is 40.5.
110 Phyllis used a triangular distribution of T(10, 15, 20) to represent her
.
daily commute time (minutes). Which statement is incorrect?
A.
B.
C.
D.

The mode of the distribution is at the mean.
The midrange of the distribution is 15.
111 In a continuous distribution:

.
A.
B.
C.
P(X < 5) is the same as P(X 5).

P(X < 5) is less than P(X 5).
P(X < 5) is more than P(X 5).
112 In a continuous distribution the

.
A.
B.
C.
D.
PDF is usually higher than the CDF.

CDF is used to find left-tail probabilities.
PDF shows the area under the curve.
CDF is usually the same as the PDF.
113 If the mean waiting time for the next arrival is 12 minutes, what is the
.
median waiting time?
A.
B.
C.
D.
7.2 minutes
8.3 minutes
9.1 minutes
12 minutes
114 If the mean waiting time for the next arrival is 18 minutes, what is the
.
first quartile (25th percentile) for waiting times?
A.
B.
C.
D.
13 minutes
7.9 minutes
5.2 minutes
3.1 minutes
115 Could this function be a PDF?

.
A.
B.
C.
Yes.
No.
It depends on x.
116 Could this function be a PDF?

.
A.
B.
C.
Yes.
No.
It depends on x.
117 The ages of job applicants for a security guard position are uniformly
.
distributed between 25 and 65. Could a 25-year-old job applicant be
two standard deviations below the mean (or more than two standard
deviations)?
A.
B.
C.
Yes.
No.
Impossible to determine from given information.
Chapter 07 Continuous Probability Distributions Answer Key
True / False Questions

1.
A continuous uniform distribution is always symmetric.

TRUE
The PDF is the same height for all X values.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 07-02 Calculate uniform probabilities.
Topic: Uniform Continuous Distribution
2.
The height and width of a continuous uniform distribution's PDF are

the same.
FALSE
The PDF height must be 1/(b - a) so that the total area is unity.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
3.
A continuous uniform distribution U(0,800) will have = 400 and =

230.94.
TRUE
Apply the formulas for the mean and standard deviation.
AACSB: Analytic
Blooms: Apply
Difficulty: 2 Medium
4.
A continuous uniform distribution U(100,200) will have the same

standard deviation as a continuous uniform distribution U(200,300).
TRUE
In the standard deviation formula, (b - a)2 is the same for both these
examples.
AACSB: Analytic
Blooms: Apply
5.
For a continuous uniform distribution U(200,400), the parameters are

= 300 and = 100.
FALSE
The standard deviation is [(400 - 200)2/12]1/2 = 57.7.
AACSB: Analytic
Blooms: Apply
6.
The exponential distribution describes the number of arrivals per unit

of time.
FALSE
Arrivals per unit of time would be Poisson (but waiting time is
exponential).
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 07-07 Find the exponential probability for a given x.
Topic: Exponential Distribution
7.
The exponential distribution is always skewed right.

TRUE
The PDF clearly shows extreme right-skewness.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
8.
If arrivals follow a Poisson distribution, waiting times follow the

exponential distribution.
TRUE
Review the definition of an exponential distribution.
AACSB: Analytic
Blooms: Understand
Difficulty: 1 Easy
9.
The triangular distribution is used in "what-if" analysis for business

planning.
TRUE
Simplicity in visualizing planning scenarios is an attraction of the
triangular distribution.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 07-09 Use the triangular distribution for "what-if" analysis (optional).
Topic: Triangular Distribution (Optional)
10.
The triangular distribution is symmetric.

FALSE
Triangular distribution is symmetric only if the mode is at the axis
midpoint.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
11.
The triangular distribution T(0,10,20) is skewed left.

FALSE
Only left-skewed if the mode is right of the axis midpoint.
AACSB: Analytic
Blooms: Apply
12.
A triangular distribution can be skewed either left or right.

TRUE
Left-skewed if the mode is right of the axis midpoint, and vice versa.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
13.
For a continuous random variable, the total area beneath the PDF will
be greater than zero but less than one.
FALSE
The total area must be 1 if it is a PDF.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 07-01 Define a continuous random variable.
Topic: Describing a Continuous Distribution
14.
The exponential distribution is continuous and the Poisson

distribution is discrete, yet the two distributions are closely related.
TRUE
Poisson arrivals (discrete) imply exponential waiting times
(continuous).
AACSB: Analytic
Blooms: Understand
15.
The mean, median, and mode of a normal distribution will always be

the same.
TRUE
A normal distribution is perfectly symmetric.
AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know the form and parameters of the normal distribution.
Topic: Normal Distribution
16.
There is a simple formula for normal areas, but we prefer a table for
greater accuracy.
FALSE
We have a formula for the PDF, but there is no exact formula for
areas under the curve.
AACSB: Analytic
Blooms: Understand
17.
Normal distributions differ only in their means and variances.

TRUE
All normal distributions look the same except for scaling.
AACSB: Analytic
Blooms: Understand
Difficulty: 1 Easy
18.
Any normal distribution has a mean of 0 and a standard deviation of

1.
FALSE
Only the standardized normal is N(0,1).
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
19.
We would use a normal distribution to model the waiting time until

the next Florida hurricane strike.
FALSE
Hurricane arrivals might be regarded as Poisson events, so waiting
times are exponential.
AACSB: Analytic
Blooms: Apply
20.
Experience suggests that 4 percent of all college students have had a

tonsillectomy. In a sample of 300 college students, we need to find
the probability that at least 10 have had a tonsillectomy. It is
acceptable to use the normal distribution to estimate this probability.
TRUE
The quick rule is n 10 and n(1 - ) 10, which is the case in this
example.
AACSB: Analytic
Blooms: Apply
Learning Objective: 07-06 Use the normal approximation to a binomial or a Poisson.
Topic: Normal Approximations
21.
The normal is a good approximation to the binomial when n is greater

than or equal to 10.
FALSE
The quick rule is n 10 and n(1 - ) 10.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
22.
The true proportion of accounts receivable with some kind of error is

4 percent for Venal Enterprises. If an auditor randomly samples 50
accounts receivable, it is acceptable to use the normal approximation
to estimate the probability that fewer than two will contain errors.
FALSE
The quick rule is n 10 and n(1 - ) 10, which is not fulfilled in
this case.
AACSB: Analytic
Blooms: Apply
23.
The normal distribution is a good approximation to the binomial if

both 10 and n 10.
FALSE
The quick rule is n 10 and n(1 - ) 10.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
24.
The normal distribution is a good approximation to the binomial if n =

200 and = .03.
FALSE
The quick rule is n 10 and n(1 - ) 10, which is not fulfilled in
this case.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
25.
The normal distribution is a good approximation to the binomial if n =

25 and = .50.
TRUE
The quick rule is n 10 and n(1 - ) 10, which is fulfilled in this
case.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
26.
The exponential distribution can be either right-skewed or leftskewed, depending on .

FALSE
The PDF of the exponential shows that it is always right-skewed.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
27.
The number of lightning strikes in a day in Miami is a continuous

random variable.
FALSE
The "number of . . ." anything is discrete.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
28.
The area under a normal curve is 1 only if the distribution is

standardized N(0,1).
FALSE
Any normal distribution has a total area of one under the PDF.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
29.
The area under an exponential curve can exceed 1 because the

distribution is right-skewed.
FALSE
If it's a PDF, the total area under the PDF is one.
AACSB: Analytic
Blooms: Apply
Multiple Choice Questions
30.
A machine dispenses water into a glass. Assuming that the amount of

water dispensed follows a continuous uniform distribution from 10
ounces to 16 ounces, the average amount of water dispensed by the
machine is:
A.
B.
C.
D.
12
13
14
16
ounces.
ounces.
ounces.
ounces.
The mean is halfway between the end points of the distribution.

AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
31.

ounces to 16 ounces, the standard deviation of the amount of water
dispensed is about:
A.
B.
C.
D.
1.73 ounces.
3.00 ounces.
0.57 ounce.
3.51 ounces.

AACSB: Analytic
Blooms: Apply
32.

ounces to 16 ounces, what is the probability that 13 or more ounces
will be dispensed in a given glass?
A.
B.
C.
D.
.1666
.3333
.5000
.6666
Half the area is above 13.

AACSB: Analytic
Blooms: Apply
33.
A random variable X is best described by a continuous uniform

distribution from 20 to 45 inclusive. The mean of this distribution is:
A.
B.
C.
D.
30.5.
31.5.
32.5.
33.5.
The mean is halfway between the end points of the distribution.

AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
34.

distribution from 20 to 45 inclusive. The standard deviation of this
distribution is approximately:
A.
B.
C.
D.
52.1.
32.5.
6.85.
7.22.

AACSB: Analytic
Blooms: Apply
35.

distribution from 20 to 45 inclusive. What is P(30 X 40)?
A.
B.
C.
D.
.20
.40
.60
.80
The desired area is 10/25 = .40.

AACSB: Analytic
Blooms: Apply
36.
The Excel function =800*RAND() would generate random numbers

with standard deviation approximately equal to:
A.
B.
C.
D.
200.
188.
231.
400.

AACSB: Analytic
Blooms: Apply
37.
The Excel function =40*RAND() would generate random numbers

with standard deviation approximately equal to
A.
B.
C.
D.
13.33.
20.00.
11.55.
19.27.

AACSB: Analytic
Blooms: Apply
38.
If arrivals occur at a mean rate of 3.6 events per hour, the

exponential probability of waiting more than 0.5 hour for the next
arrival is:
A.
B.
C.
D.
.2407.
.1653.
.1222.
.5000.
P(X > .50) = exp(-3.6 0.50) = .1653.

AACSB: Analytic
Blooms: Apply
39.
If arrivals occur at a mean rate of 3.6 events per hour, the

exponential probability of waiting less than 0.5 hour for the next
arrival is:
A.
B.
C.
D.
.7122.
.8105.
.8347.
.7809.
P(X < .50) = 1 - exp(-3.6 0.50) = 1 - .1653 = .8347.

AACSB: Analytic
Blooms: Apply
40.
If arrivals occur at a mean rate of 2.6 events per minute, the

exponential probability of waiting more than 1.5 minutes for the next
arrival is:
A.
B.
C.
D.
.0202.
.0122.
.0535.
.2564.
P(X > 1.5) = exp(-2.6 1.50) = .0202.

AACSB: Analytic
Blooms: Apply
41.
If arrivals occur at a mean rate of 1.6 events per minute, the

exponential probability of waiting less than 1 minute for the next
arrival is:
A.
B.
C.
D.
.2019.
.7104.
.8812.
.7981.
(X < 1) = 1 - exp(-1.6 1) = 1 - .2019 = .7981.

AACSB: Analytic
Blooms: Apply
42.
Bob's z-score for the last exam was 1.52 in Prof. Axolotl's class BIO
417, "Life Cycle of the Ornithorhynchus." Bob said, "Oh, good, my
score is in the top 10 percent." Assuming a normal distribution of
scores, is Bob right?
A.
B.
C.
Yes.
No.
Must have n to answer.
P(Z < 1.52) = .9357.

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-04 Find the normal probability for given z or x using tables or Excel.
Topic: Standard Normal Distribution
43.
The lengths of brook trout caught in a certain Colorado stream are

normally distributed with a mean of 14 inches and a standard
deviation of 3 inches. What proportion of brook trout caught will be
between 12 and 18 inches in length?
A.
B.
C.
D.
.6563
.6826
.2486
.4082
P(12 < X < 18) = P(-.67 < Z < 1.33) = .6568 (from Appendix C) or .
6563 using Excel.
AACSB: Analytic
Blooms: Apply
44.

deviation of 3 inches. The first quartile for the lengths of brook trout
would be:
A.
B.
C.
D.
16.01
11.00
11.98
10.65
inches.
inches.
inches.
inches.
Using Excel =NORM.INV(.25,14,3) = 11.98, or Q1 = 14 - 0.675(3) =

11.975 using Appendix C.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
Learning Objective: 07-05 Solve for z or x for a given normal probability using tables or Excel.
45.

deviation of 3 inches. What lower limit should the State Game
Commission set on length if it is desired that 80 percent of the catch
may be kept by fishers?
A.
B.
C.
D.
12.80 inches
11.48 inches
12.00 inches
9.22 inches
Using Excel =NORM.INV(.20,14,3) = 11.475, or X = 14 - 0.84(3) =

AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
46.
In Melanie's Styling Salon, the time to complete a simple haircut is

normally distributed with a mean of 25 minutes and a standard
deviation of 4 minutes. What percent of customers require less than
32 minutes for a simple haircut?
A.
B.
C.
D.
95.99
99.45
97.72
45.99
percent
percent
percent
percent
Using Excel =NORMDIST(32,25,4,1) = 0.9599, or use z = (32 - 25)/4

= 1.75 with Appendix C.
AACSB: Analytic
Blooms: Apply
47.

deviation of 4 minutes. The slowest quartile of customers will require
longer than how many minutes for a simple haircut?
A.
B.
C.
D.
3(n + 1)/4 minutes

26 minutes
25.7 minutes
27.7 minutes
Using Excel =NORM.INV(.75,25,4) = 27.698, or Q3 = 25 + 0.675(4) =

AACSB: Analytic
Blooms: Apply
48.

deviation of 4 minutes. For a simple haircut, the middle 90 percent of
the customers will require:
A.
B.
C.
D.
between
between
between
between
18.4
19.9
20.0
17.2
and
and
and
and
31.6
30.1
30.0
32.8
minutes.
minutes.
minutes.
minutes.
The 90 percent range is 1.645.

AACSB: Analytic
Blooms: Apply
49.
The area under the normal curve between z = 0 and z = 1 is

______________ the area under the normal curve between z = 1 and z
= 2.
A.
B.
C.
less than
greater than
equal to
The standard normal PDF grows closer to the axis as z increases to

the right of zero.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
50.
The price-earnings ratio for firms in a given industry follows the

normal distribution. In this industry, a firm whose price-earnings ratio
has a standardized value of z = 1.00 is approximately in the highest
______ percent of firms in the industry.
A.
B.
C.
D.
16
34
68
75
percent
percent
percent
percent
About 15.86 percent of the area is above one standard deviation.

AACSB: Analytic
Blooms: Apply
51.
A student's grade on an examination was transformed to a z value of

0.67. Assuming a normal distribution, we know that she scored
approximately in the top:
A.
B.
C.
D.
15
50
40
25
percent.
percent.
percent.
percent.
P(Z > 0.67) = 1 - P(Z < 0.67) = 1 - .2514 = .7486.

AACSB: Analytic
Blooms: Apply
52.
The MPG (miles per gallon) for a certain compact car is normally
distributed with a mean of 31 and a standard deviation of 0.8. What
is the probability that the MPG for a randomly selected compact car
would be less than 32?
A.
B.
C.
D.
0.3944
0.8944
0.1056
0.5596
P(X < 32) = P(Z < 1.25) = .8944.

AACSB: Analytic
Blooms: Apply
53.
The probability is .80 that a standard normal random variable is

between -z and +z. The value of z is approximately:
A.
B.
C.
D.
1.28.
1.35.
1.96.
1.45.
For tail areas of .1000 we would use z = 1.282.

AACSB: Analytic
Blooms: Apply
54.
The time required for a citizen to complete the 2010 U.S. Census
"long" form is normally distributed with a mean of 40 minutes and a
standard deviation of 10 minutes. What proportion of the citizens will
require less than one hour?
A.
B.
C.
D.
0.4772
0.9772
0.9974
0.9997
P(X < 60) = P(Z < 2.00) = .9772.

AACSB: Analytic
Blooms: Apply
55.
standard deviation of 10 minutes. The slowest 10 percent of the
citizens would need at least how many minutes to complete the
form?
A.
B.
C.
D.
27.2
35.8
52.8
59.6
Using Excel =NORM.INV(.90,40,10) = 52.82, or 40 + 1.282(10) =

AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
56.
standard deviation of 10 minutes. What is the third quartile (in
minutes) for the time required to complete the form?
A.
B.
C.
D.
44.75
46.75
47.50
52.50
Using Excel =NORM.INV(.75,40,10) = 46.75, or Q3 = 40 + 0.675(10)

= 46.75 using Appendix C
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
57.
Exam scores were normal in BIO 200. Jason's exam score was one
standard deviation above the mean. What percentile is he in?
A.
B.
C.
D.
68th
75th
78th
84th
About 15.87 percent of the area lies above one standard deviation.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
58.
Compared to the area between z = 1.00 and z = 1.25, the area

between z = 2.00 and z = 2.25 in the standard normal distribution
will be:
A.
smaller.
B.
larger.
C.
the same.
D. impossible to compare without knowing and .
The normal PDF approaches the axis as z increases beyond zero.
AACSB: Analytic
Blooms: Apply
59.
A large number of applicants for admission to graduate study in

business are given an aptitude test. Scores are normally distributed
applicants would you expect to have scores of 600 or above?
A.
B.
C.
D.
0.0401
0.4599
0.5401
0.0852
P(X > 600) = P(Z > 1.75) = .0401.

AACSB: Analytic
Blooms: Apply
60.

the applicants would you expect to have a score of 400 or above?
A.
B.
C.
D.
0.2734
0.7734
0.7266
0.7500
P(X > 400) = P(Z > -0.75) = .7734.

AACSB: Analytic
Blooms: Apply
61.

with a mean of 460 and standard deviation of 80. The top 2.5 percent
of the applicants would have a score of at least (choose the nearest
integer):
A.
B.
C.
D.
606.
617.
600.
646.
Using z = 1.96, we get X = 460 + 1.96 80 = 616.8.

AACSB: Analytic
Blooms: Apply
62.
If the random variable Z has a standard normal distribution, then

P(1.25 Z 2.17) is:
A.
B.
C.
D.
0.0906.
0.9200.
0.4700.
0.3944.
P(Z 2.17) - P(Z 1.25) = .0906.

AACSB: Analytic
Blooms: Apply
63.
If the random variable Z has a standard normal distribution, then P(Z

-1.37) is:
A.
B.
C.
D.
0.9147.
0.4147.
0.5016.
0.0853.
From Appendix C we get the left tail area of .0853.

AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
64.
Assume that X is normally distributed with a mean = $64. Given

that P(X $75) = 0.2981, we can calculate that the standard
deviation of X is approximately:
A.
B.
C.
D.
$20.76.
$13.17.
$5.83.
$7.05.
For a right-tail area of .2981 we need z = -.53, so with x = 75 we set

z = (x - )/ and solve for .
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
65.
The standard deviation of a normal random variable X is $20. Given

that P(X $10) = 0.1841. From this we can determine that the mean
of the distribution is equal to:
A.
B.
C.
D.
$13.
$26.
$20.
$28.
For a left-tail area of .1841 we need z = -.90, so with x = 10 we set z

= (x - )/ and solve for .
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
66.
The random variable X is normally distributed with mean of 80 and

variance of 36. The 67th percentile of the distribution is:
A.
B.
C.
D.
72.00.
95.84.
90.00.
82.64.
Since P(Z < 0.44) = .6700, (from Appendix C) we get 80 + 0.44(6) =

82.64.
AACSB: Analytic
Blooms: Apply
67.
The area under the normal curve between the 20th and 70th
percentiles is equal to:
A.
B.
C.
0.7000.
0.5000.
0.9193.
Logically, this must be .70 - .20 = .50, as you can verify from
Appendix C.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
68.
The variable in a normal distribution can assume any value between
A.
B.
C.
D.
-3 and +3
-4 and +4
-1 and +1
- and +
Almost all the area is within -3 and +3, but the curve never quite
touches the z-axis.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
69.
What are the mean and standard deviation for the standard normal
distribution?
A.
B.
C.
D.
=
=
=
=
0,
1,
1,
0,
=
=
=
=
0
1
0
1
We have standardized so the mean must be zero.

AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
70.
Any two normal curves are the same except for their:
A.
standard deviations.
B.
means.
C.
standard deviations and means.
D. standard deviations, means, skewness, and kurtosis.
We write N(,) so show the similarity of all normals.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
71.
Light bulbs are normally distributed with an average lifetime of 1000

hours and a standard deviation of 250 hours. The probability that a
light bulb picked at random will last less than 1500 hours is about:
A.
B.
C.
D.
97.72
95.44
75.00
68.00
percent.
percent.
percent.
percent.
P(Z < 1500) = P(Z < 2.00) = .9772 from Appendix C (or from Excel).
AACSB: Analytic
Blooms: Apply
72.
To convert a normally distributed variable X into a standard Z score

we would:
A. subtract the mean from the original observation and divide the
result by the variance.
B. subtract the mean from the original observation and divide the
result by the standard deviation.
C. add the mean and the original observation, then divide by the
variance.
D. subtract the mean from the standard deviation and divide by the
variance.
Review the z-score transformation.
AACSB: Analytic
Blooms: Understand
Difficulty: 1 Easy
73.
Regarding continuous probability distributions, which statement is

incorrect?
A. The triangular distribution may be skewed left or right.

B. The uniform distribution is never skewed.
C. The normal distribution is sometimes skewed.
D. The exponential distribution is always skewed right.
Review the characteristics of these four distributions.
AACSB: Analytic
Blooms: Understand
74.
Which model best describes your waiting time until you get the next
nonworking web URL ("This page cannot be displayed") as you click
on various websites for Florida condo rentals?
A.
B.
C.
D.
Triangular
Uniform
Normal
Exponential
Waiting time until the next event resembles an exponential

distribution.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
75.
On average, a major earthquake (Richter scale 6.0 or above) occurs 3

times a decade in a certain California county. What is the probability
that less than six months will pass before the next earthquake?
A.
B.
C.
D.
.1393
.8607
.0952
.9048
Set = 3/120 = 0.025 earthquake/month so P(X < 6) = 1 - exp(0.025 6) = 1 - .8607 = .1393.

AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
76.
If the mean time between in-flight aircraft engine shutdowns is

12,500 operating hours, the 90th percentile of waiting times to the
next shutdown will be:
A.
B.
C.
D.
20,180
28,782
23,733
18,724
hours.
hours.
hours.
hours.
Set = 1/12500 and solve for x in left-tail area of 1 - exp(-x) = .90

by taking logs of both sides.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
Learning Objective: 07-08 Solve for x for a given exponential probability.
77.
On average, 15 minutes elapse between discoveries of fraudulent

corporate tax returns in a certain IRS office. What is the probability
that less than 30 minutes will elapse before the next fraudulent
corporate tax return is discovered?
A.
B.
C.
D.
.1353
.6044
.7389
.8647
P(X < 30) = 1 - exp(-x) = 1 - exp(-(1/15) 30) = 1 - .1353 = .8647.

AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
78.
If the mean time between unscheduled maintenance of LCD displays

in a hospital's CT scan facility is 4,000 operating hours, what is the
probability of unscheduled maintenance in the next 5,000 hours?
A.
B.
C.
D.
.8000
.7135
.2865
.5000
P(X < 5000) = 1 - exp(-x) = 1 - exp(-(1/4000) 5000) = 1 - .2865 =

.7135.
AACSB: Analytic
Blooms: Apply
79.
A certain assembly line at Vexing Manufacturing Company averages

30 minutes between breakdowns. What is the probability that less
than 6 minutes will elapse before the next breakdown?
A.
B.
C.
D.
.8187
.0488
.1813
.2224
(X < 6) = 1 - exp(-x) = 1 - exp(-(1/30) 6) = 1 - .8187 = .1813.

AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
80.
A certain assembly line at Vexing Manufacturing Company averages

30 minutes between breakdowns. The median time between
breakdowns is:
A.
B.
C.
D.
30.0
35.7
25.4
20.8
minutes.
minutes.
minutes.
minutes.
Set = 1/30 and solve for x in right-tail area of 1 - exp(-x) = .50 by

taking logs of both sides.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
81.
Which probability model is most appropriate to describe the waiting

time (working days) until an office photocopier breaks down (i.e.,
requires unscheduled maintenance)?
A.
B.
C.
D.
Normal
Uniform
Exponential
Poisson
Poisson breakdowns suggest exponential waiting time.

AACSB: Analytic
Blooms: Apply
82.
Bob's z-score for the last exam was -1.15 in FIN 417, "Capital
Budgeting Strategies." Bob said, "Yipe! My score is within the bottom
quartile." Assuming a normal distribution, is Bob right?
A.
B.
C.
Yes
No
Must know the class size to answer
The bottom quartile would be below z = -.675 so Bob is indeed below

that point.
AACSB: Analytic
Blooms: Apply
83.
Exam scores were normal in MIS 200. Jason's exam score was 1.41
standard deviations above the mean. What percentile is he in?
68th
75th
84th
92nd
A.
B.
C.
D.
P(Z < 1.41) = .9207.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
84.
Compared to the area between z = 0.50 and z = 0.75, the area

between z = 1.50 and z = 1.75 in the standard normal distribution
will be:
A.
B.
C.
smaller
larger
the same
The normal PDF approaches the axis as z increases beyond zero so

areas get smaller.
AACSB: Analytic
Blooms: Apply
85.
If GMAT scores for applicants at Oxnard Graduate School of Business

are N(500, 50) then the top 5 percent of the applicants would have a
score of at least (choose the nearest integer):
A.
B.
C.
D.
575.
582.
601.
608.
The top 5 percent would require z = 1.645 so x = 500 + 1.645(50) =

582.25.
AACSB: Analytic
Blooms: Apply
86.
If the random variable Z has a standard normal distribution, then

P(1.17 Z 2.26) is:
A.
B.
C.
D.
0.1091.
0.1203.
0.2118.
0.3944.
Subtract P(Z 2.26) - P(Z 1.17).

AACSB: Analytic
Blooms: Apply
87.
If the random variable Z has a standard normal distribution, then P(Z

-1.72) is:
A.
B.
C.
D.
0.9573.
0.0446.
0.5016.
0.0427.
Use Appendix C or Excel =NORM.S.DIST(-1.72,1).

AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
88.
Excel's =100*RAND() function produces continuous random numbers

that are uniformly distributed between 0 and 100. The standard
deviation of this distribution is approximately:
A.
B.
C.
D.
50.00.
28.87.
33.33.
25.00.
The standard deviation is [(b - a)2/12]1/2 = [(100 - 0)2/12]1/2.

AACSB: Analytic
Blooms: Apply
89.
Excel's =RAND() function produces random numbers that are

uniformly distributed between 0 and 1. The mean of this distribution
is approximately
A.
B.
C.
D.
.5000
.2500
.3333
.2887
The mean is halfway between the end points.

AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
90.
Excel's =RAND() function produces random numbers that are

uniformly distributed from 0 to 1. What is the probability that the
random number exceeds .75?
A.
B.
C.
75 percent
50 percent
25 percent
This is the upper 25 percent.

AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
91.
Which is the correct Excel formula for the 80th percentile of a

distribution that is N(475, 33)?
A.
B.
C.
=NORM.DIST(80, 475, 33,1)

=NORM.INV(0.80, 475, 33)
=NORM.S.INV((80 - 475)/33)
Review Excel functions in Appendix J.

AACSB: Technology
Blooms: Remember
92.
If arrivals follow a Poisson distribution with mean 1.2 arrivals per

minute, find the 75th percentile of waiting times until the next arrival
(i.e., 75 percent below).
A.
B.
C.

0.240 minute (14.4 seconds)
Set = 1.2 and solve for x in right-tail area of exp(-x) = .25 by

taking logs of both sides.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
93.
A software developer makes 175 phone calls to its current customers.

There is an 8 percent chance of reaching a given customer (instead
of a busy signal, no answer, or answering machine). The normal
approximation of the probability of reaching at least 20 customers is:
A.
B.
C.
D.
.022.
.007.
.063.
.937.
Set n = 175 and = .08. Calculate = n = (175)(.08) = 14 and =

[n(1 - )]1/2 = [175(.08)(1 - .08)]1/2 = 3.588872. Use x = 19.5 (with
the continuity correction) and calculate the binomial P(X 20) P(z
1.532515) using z = (x - )/ = 1.532515.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
94.
For Gardyloo Manufacturing, the true proportion of accounts

receivable with some kind of error is .20. If an auditor randomly
samples 225 accounts receivable, what is the approximate normal
probability that 39 or fewer will contain errors?
A.
B.
C.
D.
.1797
.2097
.1587
.0544
Set = n and = [n(1 - )]1/2 and convert x = 39.5 (using the

continuity correction) to a z score with z = (x - )/. Set n = 225 and
= .20. Calculate = n = (225)(.20) = 45 and = [n(1 - )]1/2 =
[225(.20)(1 - .20)]1/2 = 6.000. Use x = 39.5 (with the continuity
correction) and calculate the binomial P(X 39) P(z -.916667)
using z = (x - )/ = -.916667.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
95.
A letter is mailed to a sample of 500 homeowners. Based on past

experience, the probability of an undeliverable letter is 0.06. The
normal approximation to the binomial probability of 40 or more
undeliverable letters is:
A.
B.
C.
D.
0.9632
0.0368
0.2305
0.7695

[n(1 - )]1/2 = [500(.06)(1 - .06)]1/2 = 5.31037. Use x = 39.5 (with the
continuity correction) and calculate the binomial P(X 40) P(z
1.78895) using z = (x - )/ = 1.78895.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
96.
In a T-F exam with 100 questions, passing requires a score of at least

60. What is the approximate normal probability that a "guesser" will
score at least 60 points?
A.
B.
C.
D.
.0287
.4713
.0251
.0377
A guesser would have a 50 percent chance of a correct answer, so we

set = .50. There are n = 100 questions, so we calculate = n =
(100)(.50) = 50 and = [n(1 - )]1/2 = [100(.50)(1 - .50)]1/2 = 5. Use
x = 59.5 (with the continuity correction) and calculate the binomial
P(X 60) P(z 1.90) using z = (x - )/ = 1.90.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
97.
A multiple choice exam has 100 questions. Each question has five
choices. What would be the approximate probability that a "guesser"
could achieve a score of 30 or more?
A.
B.
C.
D.
0.0088
0.0062
0.0015
0.4913
A guesser would have a 20 percent chance of a correct answer (1 out

of 5) so we set = .20. There are n = 100 questions, so we calculate
= n = (100)(.20) = 20 and = [n(1 - )]1/2 = [100(.20)(1 - .20)]1/2
= 4. Use x = 29.5 (with the continuity correction) and calculate the
binomial P(X 30) P(z 2.375) using z = (x - )/ = 2.375.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
98.
For which binomial distribution would a normal approximation be

most acceptable?
A.
B.
C.
D.
n = 50, = 0.05
n = 100, = 0.04
n = 40, = 0.25
n = 400, = 0.02
We want n 10 and n(1 - ) 10.

AACSB: Analytic
Blooms: Apply
99.
Historically, the default rate on a certain type of commercial loan is

20 percent. If a bank makes 100 of these loans, what is the
approximate probability that at least 26 will result in default?
A.
B.
C.
D.
0.2000
0.0668
0.0846
0.0336

[n(1 - )]1/2 = [100(.20)(1 - .20)]1/2 = 4. Use x = 25.5 (with the
continuity correction) and calculate the binomial P(X 26) P(z
1.375) using z = (x - )/ = 1.375.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
100. A company employs 300 employees. Each year, there is a 30 percent

turnover rate for employees. We want to do a normal approximation
to the binomial distribution of the number of employees who leave
each year. For this normal approximation, the mean is ______ and the
standard deviation is _____.
A.
B.
C.
D.
90, 63
90, 7.937
90, 30
90, 15
Use n = 300 and = .30, and then calculate = n and = [n(1 )]1/2.
AACSB: Analytic
Blooms: Apply
101. The probability that a rental car will be stolen is 0.001. If 25,000 cars
are rented from Hertz, what is the normal approximation to the
probability that fewer than 20 will be stolen?
A.
B.
C.
D.
.2577
.1335
.1128
.8335
Set n = 25,000 and = .001. Calculate = n = (25000)(.001) = 25

and = [n(1 - )]1/2 = [25000(.001)(1 - .001)]1/2 = 4.9975 Use x =
19.5 (with the continuity correction) and calculate the binomial P(X <
20) P(z <-1.10055) using z = (x - )/ = -1.10055.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
102. If adult male heights are normally distributed with a mean of 180 cm
and a standard deviation of 7 cm, how high should an aircraft
lavatory door be to ensure that 99.9 percent of adult males will not
have to stoop as they enter?
A.
B.
C.
D.
195.7
201.6
207.3
201.4
cm
cm
cm
cm
With Excel we get =NORM.INV(.999,180,7) = 201.63, or Appendix C

with z = 3.09.
AACSB: Analytic
Blooms: Apply
103. TotCo is developing a new deluxe baby bassinet. If the length of a

newborn baby is normally distributed with a mean of 50 cm and a
standard deviation of 5 cm, what should be the interior length of the
bassinet to ensure that 99 percent of newborn babies will fit, with a
safety margin of 15 cm on each end of the bassinet?
A.
B.
C.
D.
95.45
85.22
91.63
98.92
cm
cm
cm
cm
With Excel we get =NORM.INV(.99,50,5) + 30 = 91.63, or Appendix C

with z = 2.33.
AACSB: Analytic
Blooms: Apply
104. The triangular distribution T(4, 12, 26) has a mean of:
A.
B.
C.
D.
14.
18.
12.
13.
Mean is (4 + 12 + 26)/3.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
105. The triangular distribution T(0, 10, 20) has a standard deviation of:
A.
B.
C.
D.
4.082.
3.775.
3.024.
2.994.
Set a = 0. b = 10, c = 20 and use the triangular standard deviation

formula = [(a2 + b2 + c2 - ab - ac - bc)/18]1/2 = 4.082.
AACSB: Analytic
Blooms: Apply
106. The triangular distribution T(5, 23, 62) has a mean of:
A.
B.
C.
D.
23.
30.
33.
35.
Mean is (5 + 23 + 62)/3.
AACSB: Analytic
Blooms: Apply
Difficulty: 1 Easy
107. The triangular distribution T(10, 20, 50) has a standard deviation of:
A.
B.
C.
D.
9.498.
9.225.
8.498.
7.710.
Set a = 10, b = 20, c = 50 and use the triangular standard deviation

formula = [(a2 + b2 + c2 - ab - ac - bc)/18]1/2 = 8.498.
AACSB: Analytic
Blooms: Apply
108. Which statement is incorrect?
A. The triangular distribution always has a single mode.

B. The mean of the triangular distribution is (a + b + c)/3.
C. The triangular distribution is right-skewed.
The triangular distribution may be skewed right or left, and is
symmetric only if the mode is halfway between a and c. Review
properties of the triangular distribution.
AACSB: Analytic
Blooms: Remember
109. Bob used a triangular distribution of T(20, 30, 61) to represent his
A.
B. The mode of the distribution exceeds the mean.
C.
D. The midrange of the distribution is 40.5.
This triangular distribution is right-skewed. The mean is (20 + 30 +
61)/3 = 37, which exceeds the mode b = 30. It would be helpful to
sketch a graph of the PDF.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
110. Phyllis used a triangular distribution of T(10, 15, 20) to represent her
A.
B.
C.
D.

The mode of the distribution is at the mean.
The midrange of the distribution is 15.
The distribution is symmetric if the mode b lies halfway between the

end points. In this example, (a + c)/2 = (10 + 20)/2 = 15 so the
mode b = 15 is halfway between the minimum and maximum.
AACSB: Analytic
Blooms: Apply
111. In a continuous distribution:
A.
B.
C.
P(X < 5) is the same as P(X 5).

P(X < 5) is less than P(X 5).
P(X < 5) is more than P(X 5).
A point has no area in a continuous CDF.

AACSB: Analytic
Blooms: Understand
112. In a continuous distribution the
A.
B.
C.
D.
PDF is usually higher than the CDF.

CDF is used to find left-tail probabilities.
PDF shows the area under the curve.
CDF is usually the same as the PDF.
The CDF shows P(X x). Review definitions of PDF and CDF.
AACSB: Analytic
Blooms: Understand
113. If the mean waiting time for the next arrival is 12 minutes, what is
the median waiting time?
A.
B.
C.
D.
7.2
8.3
9.1
12
minutes
minutes
minutes
minutes
Set = 1/12 minute per arrival and take logs of both sides of exp(-x)
= .50 to solve for x.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
114. If the mean waiting time for the next arrival is 18 minutes, what is
the first quartile (25th percentile) for waiting times?
A.
B.
C.
D.
13
7.9
5.2
3.1
minutes
minutes
minutes
minutes
Set = 1/18 minute per arrival and take logs of both sides of exp(-x)
= .75 to solve for x.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard
115. Could this function be a PDF?
A.
B.
C.
Yes.
No.
It depends on x.
Area = 1/2 base height = .500, which is not 1 so it cannot be a

PDF.
AACSB: Analytic
Blooms: Apply
116. Could this function be a PDF?
A.
B.
C.
Yes.
No.
It depends on x.
Area = base height = 2, which is not 1 so it cannot be a PDF.

AACSB: Analytic
Blooms: Apply
117. The ages of job applicants for a security guard position are uniformly
distributed between 25 and 65. Could a 25-year-old job applicant be
two standard deviations below the mean (or more than two standard
deviations)?
A.
Yes.
B.
No.
C. Impossible to determine from given information.
Since = [(65 - 25)2/12]1/2 = 11.54, we can see that 25 is not 2
below the mean of 45.
AACSB: Analytic
Blooms: Apply
Difficulty: 3 Hard

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Chapter 07

Continuous Probability Distributions

True / False Questions

3. A continuous uniform distribution U(0,800) will have = 400 and =

4. A continuous uniform distribution U(100,200) will have the same

5. For a continuous uniform distribution U(200,400), the parameters are

6. The exponential distribution describes the number of arrivals per unit of

7. The exponential distribution is always skewed right.

8. If arrivals follow a Poisson distribution, waiting times follow the

9. The triangular distribution is used in "what-if" analysis for business

10 The triangular distribution is symmetric.

14 The exponential distribution is continuous and the Poisson distribution

15 The mean, median, and mode of a normal distribution will always be

17 Normal distributions differ only in their means and variances.

20 Experience suggests that 4 percent of all college students have had a

21 The normal is a good approximation to the binomial when n is greater

22 The true proportion of accounts receivable with some kind of error is 4

23 The normal distribution is a good approximation to the binomial if both

24 The normal distribution is a good approximation to the binomial if n =

25 The normal distribution is a good approximation to the binomial if n =

26 The exponential distribution can be either right-skewed or left-skewed,

27 The number of lightning strikes in a day in Miami is a continuous

28 The area under a normal curve is 1 only if the distribution is

29 The area under an exponential curve can exceed 1 because the

Multiple Choice Questions

31 A machine dispenses water into a glass. Assuming that the amount of

32 A machine dispenses water into a glass. Assuming that the amount of

33 A random variable X is best described by a continuous uniform

34 A random variable X is best described by a continuous uniform

35 A random variable X is best described by a continuous uniform

36 The Excel function =800*RAND() would generate random numbers with

37 The Excel function =40*RAND() would generate random numbers with

40 If arrivals occur at a mean rate of 2.6 events per minute, the

41 If arrivals occur at a mean rate of 1.6 events per minute, the

43 The lengths of brook trout caught in a certain Colorado stream are

44 The lengths of brook trout caught in a certain Colorado stream are

45 The lengths of brook trout caught in a certain Colorado stream are

46 In Melanie's Styling Salon, the time to complete a simple haircut is

47 In Melanie's Styling Salon, the time to complete a simple haircut is

3(n + 1)/4 minutes

48 In Melanie's Styling Salon, the time to complete a simple haircut is

between 18.4 and 31.6 minutes.

49 The area under the normal curve between z = 0 and z = 1 is

51 A student's grade on an examination was transformed to a z value of

53 The probability is .80 that a standard normal random variable is

58 Compared to the area between z = 1.00 and z = 1.25, the area

60 A large number of applicants for admission to graduate study in

61 A large number of applicants for admission to graduate study in

62 If the random variable Z has a standard normal distribution, then P(1.25

63 If the random variable Z has a standard normal distribution, then P(Z

64 Assume that X is normally distributed with a mean = $64. Given that

65 The standard deviation of a normal random variable X is $20. Given

66 The random variable X is normally distributed with mean of 80 and

68 The variable in a normal distribution can assume any value between

72 To convert a normally distributed variable X into a standard Z score we

73 Regarding continuous probability distributions, which statement is

A. The triangular distribution may be skewed left or right.

75 On average, a major earthquake (Richter scale 6.0 or above) occurs 3

76 If the mean time between in-flight aircraft engine shutdowns is 12,500

77 On average, 15 minutes elapse between discoveries of fraudulent

78 If the mean time between unscheduled maintenance of LCD displays in

79 A certain assembly line at Vexing Manufacturing Company averages 30

80 A certain assembly line at Vexing Manufacturing Company averages 30