Suppose the average monthly demand for a retail SKU item is 55 with a standard deviation of 8 and this is given by a normal distribution a) Suppose you think about next month. What is the chance the demand will be more than 60?musigmaxzright tail area b) Suppose you think about the next year (so 12 months). What is the chance the average demand over the next 12 months will be more than 60?musigmaxbarnzright tail area

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MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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Suppose the average monthly demand for a retail SKU item is 55 with a standard deviation of 8 and this is given by a normal distribution

a) Suppose you think about next month. What is the chance the demand will be more than 60?

sigma

right tail area

b) Suppose you think about the next year (so 12 months). What is the chance the average demand over the next 12 months will be more than 60?

sigma

xbar

right tail area

Features Features Normal distribution is characterized by two parameters, mean (µ) and standard deviation (σ). When graphed, the mean represents the center of the bell curve and the graph is perfectly symmetric about the center. The mean, median, and mode are all equal for a normal distribution. The standard deviation measures the data's spread from the center. The higher the standard deviation, the more the data is spread out and the flatter the bell curve looks. Variance is another commonly used measure of the spread of the distribution and is equal to the square of the standard deviation.

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