Quantitative Method For Business

Quantitative Method For Business QAT1 - Task 4 - Finding Probabilities from Z-scores • • • Rate This Article (Average Rating: 3) Show Properties QAT1 - Task 4 - Finding Probabilities from Z-scores Once you have the z-score you can use a Standard Normal Cumulative Distribution Table (there is one attached to this document, scroll to bottom of page) to look up the corresponding probability. For example, what is the probability that corresponds to z = 0.55? • Look for the ones and tenths place of the decimal down the left hand column (that would be 0.5 for our example) • Match that to the hundredth place column (that would be 0.05 for our example) • The corresponding probability is 0.7088 or 70.88%. Alternatively you can use an Excel function “=NORMSDIST(z)”, replacing “z” in the function with your z-score value. • Using the Excel function with our example we would type “=NORMSDIST(0.55)” to determine the probability that corresponds to z = 0.55 • If you have a newer version of Excel you may need to use =NORM.S.DIST(0.55,true). You have to use the true but the z is from your calculation. • After we hit enter we should see .7088 or however many decimal places our cell is defaulted to. • We can still see the formula if we double click the cell or look at the formula bar while we are in the cell • There are also web sites with calculators. For example, you would take the resulting Z value, plug it into the following website, and hit “calculate”. • https://www.easycalculation.com/statistics/p-value-for-z-score.php • Use the number in the top box, the “Left-tailed P-value (Z < 1)” is the probability. StdNormDisTable.pdf Article Link: