e) Anticipated weekly demand for a particular brand of washing powder is represented by a normal distribution with mean 720 units, and standard deviation 72 units. (i) What is the probability that demand will be less than 650 units? (ii) What is the probability that demand will be between 650 and 750 units? (iii) How many units should be stocked to ensure that the probability of finishing the week with unsold stock is 0.1?
Continuous Probability Distributions
Probability distributions are of two types, which are continuous probability distributions and discrete probability distributions. A continuous probability distribution contains an infinite number of values. For example, if time is infinite: you could count from 0 to a trillion seconds, billion seconds, so on indefinitely. A discrete probability distribution consists of only a countable set of possible values.
Normal Distribution
Suppose we had to design a bathroom weighing scale, how would we decide what should be the range of the weighing machine? Would we take the highest recorded human weight in history and use that as the upper limit for our weighing scale? This may not be a great idea as the sensitivity of the scale would get reduced if the range is too large. At the same time, if we keep the upper limit too low, it may not be usable for a large percentage of the population!
e) Anticipated weekly demand for a particular brand of washing powder is represented by a
(i) What is the
(ii) What is the probability that demand will be between 650 and 750 units?
(iii) How many units should be stocked to ensure that the probability of finishing the week with unsold stock is 0.1?
Step by step
Solved in 4 steps with 3 images
