LIR 493: Quantitative Methods Professor Wallace Hendricks

normal distribution DISTRIBUTIONS IN EXCEL

1. Finding the probability that a value will lie between negative infinity and the value x:
   
   NORMDIST (X,MU,SIGMA,TRUE), where X is the value that you want,
   MU is the mean of the distribution, SIGMA is the standard deviation of the
   distribution.
2. Finding the probability in an interval: If X and Y are the interval points, just use
   NORMDIST for X and Y and subtract the two to find the probability that the result will occur in the interval.
3. Finding a value from a probability: Suppose that you want the cutoff value (X) that yields 90% of the distribution, just use
   NORMINV(P,MU,SIGMA) where P is the percentage (in this case .9), MU is the mean and SIGMA is the standard deviation .
4. Find a Z-score
   STANDARDIZE(X,MU,SIGMA) returns the Z-score for X
5. Finding a probability associated with a Z-score (negative infinity to the Z-score)
   NORMSDIST(Z) returns the probability P
6. Finding a Z associated with a probability P
   NORMSINV(P) returns the associated Z-score

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