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Suppose the board of directors for Cosmic Coffee wants to know the price range for the lowest 40% of drink sales. Find the z-score associated with the upper boundary of this price range.

User NirIzr
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1 Answer

21 votes
21 votes

Answer:

Explanation:

The z-score associated with the upper boundary of of this price range is -0.25.

Explanation:

It is provided that the board of directors for Cosmic Coffee wants to know the price range for the lowest 40% of drink sales.

If X represents the price range of drink sales, then

P (X < x) = 0.40

Consider that X follows a Normal distribution.

To compute the probability of a normally distributed random variable we need to first convert the raw score to the z-scores.

The formula to z-score is:

Then,

P (X < x) = 0.40

⇒ P (Z < z) = 0.40

The value of z for this probability is:

z = -0.25

*Use a z-table.

Thus, the z-score associated with the upper boundary of of this price range is -0.25.

User Amantel
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2.9k points
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