Guide to Using Excel 2007 For Basic Statistical Applications To Accompany Business Statistics: A Decision Making Approach, 8th Ed. Chapter 6: Introduction to Continuous Probability Distributions By Groebner, Shannon, Fry, & Smith Prentice-Hall Publishing Company Copyright, 2011

Chapter 6 Excel Examples Using the Normal Distribution- State Bank and Trust Exponential Distribution– Haines Internet Service Creating a Standard Normal Table

Standard Normal Distribution- State Bank and Trust Issue: State bank managers have studied the time customers spend at the bank on business. They plan to offer a gift certificate to any customer who is required to spend over 30 minutes on bank business. Objective: Use Excel 2007 to create a histogram and determine the probability that a gift certificate will be given to any customer. The data file is State Bank.xls.

Standard Normal – State Bank and Trust Open file StateBank.xls

Standard Normal – State Bank and Trust Using the Data Analysis – Histogram Function, Build the Histogram as indicated. Select Chart Output

Standard Normal – State Bank and Trust Format as per Chapter 2

Standard Normal – State Bank and Trust Using the Chart Tools option, Format the histogram, insert titles and labels Next, determine probability of a service time exceeding 30 minutes.

Standard Normal – State Bank and Trust Using the Chart Tools option, Format the histogram, insert titles and labels Next, determine probability of a service time exceeding 30 minutes.

Standard Normal – State Bank and Trust Select Formulas Select Statistical Select NormDist Select Formulas Statistical

Standard Normal – State Bank and Trust Insert: X = 30 Mean = 22.14 Standard Dev = 6.09 Cumulative – true Probability P(X <= 30) = .9016

Exponential Distribution- Haines Internet Services Issue: Assume the time between connect attempts averages two minutes and the distribution of time between attempts is assumed to be exponential. Objective: Use Excel 2007 to compute the probability that that the time between connect attempts will be less than 45 seconds (.75 minutes).

Exponential Distribution - Haines Internet Services Select the Formulas tab Select More Functions Select Statistical Select EXPONDIST

Exponential Distribution - Haines Internet Services Input: X = .75 Lambda = .50 True Cumulative Exponential Probability

Creating A Standard Normal Distribution Table Issue: The Standard Normal tables in the Appendix of this text were created using Excel. Objective: Use Excel to generate a standard normal table for z values below zero.

Creating the Standard Normal Table Z-value, second decimal place Z-value integer and first decimal place

Creating the Standard Normal Table Formula: ABS function is for absolute value. Mean for NORMDIST function is -0.0 -.01 = - .01 Notice use of absolute cell references to allow formula to be copied across and down to finish the table Probabilities correspond to area on the standard normal table between the Z value and the mean = 0