Question

Assume that the mean hourly cost to operate a commercial airplane follows the normal distribution with a mean of $2,500 per hour and a standard deviation of $235.

  

What is the operating cost for the lowest 3 percent of the airplanes? (Round z value to 2 decimal places. Omit the "$" sign in your response.)

  

Answer 1

we have = 2500, = 235

we have to find the operating cost using the lowest 3% value for z

using technology, we will get z = -1.88 for lowest 3%

using the formula

z = (x- )/

setting the given values, we get

-1.88 = (x - 2500)/235

multiplying both sides by 235, we get

-1.88*235 = x- 2500

-441.8 = x- 2500

adding 2500 on both sides, we get

-441.8+2500 = x

this gives x = 2058.20

so, the operating cost for the lowest 3% of the airlines is 2058.20 (rounded to 2 decimals)