Question

A set of books in a store are normally distributed with a mean of 50 dollars and a standard deviation of 44 dollars. In the store, 10.56% of the books are lower than the price I am willing to pay. What is the price I am willing to pay? (Do not worry about dollar signs.)

Answer 1

Given that, mean = 50 dollars and

standard deviation = 4 dollars

We want to find, the value of x such that, P(X < x) = 0.1056

Therefore, in the store 10.56% of the books are lower than 45 dollars ( i.e. the price you willing to pay should be 45 dollars).

Note: We take standard deviation = 4 dollars because if we used standard deviation of 44 dollars (given in above question ) then it goves the negative price.