In: Statistics and Probability
A large retailer wants to reduce its stores' overhead costs by switching to more energy efficient light bulbs. The company plans on conducting a series of tests to determine if this strategy will be effective. The average cost of the bulbs they are considering using is $35.95, and the standard deviation for these prices is $2.75. If the prices of these bulbs have a normal probability distribution, find the probability that a random selection of ten of these bulbs will have an average cost of more than $34.00.
Round your Z value(s) to two decimal places. Do not round any other intermediate calculations. Enter your answer as a decimal rounded to four places.
Probability =
Solution :
Given that ,
mean =
= $35.95
standard deviation =
= $2.75
n = 10
= 35.95
=
/
n = 2.75 /
10 = 0.8696
P( > 34.00) = 1 - P(
< 34.00)
= 1 - P[(
-
) /
< (34.00-35.95) /0.8696 ]
= 1 - P(z < -2.24)
Using z table
= 1 - 0.0125
= 0.9875
probability= 0.9875