Question

Question 11 (1 point) The daily stock price for International Business Machines (IBM) historically has followed an approximately normal distribution (when adjusting for inflation) with a mean of $134.915 and standard deviation of $4.3786 Approximately 20.13% of days IBM had a stock price less than what dollar amount? 1) We do not have enough information to calculate the value. 2) 131.25 3) 118.87 4) 150.96 5) 138.58

Answer 1

µ = 134.915

sd = 4.3786

$P(X<x)=0.2013$

$or,P(\frac{X-\mu}{\sigma}<\frac{x-\mu}{\sigma})=0.2013$

$or,P(Z<\frac{x-134.915}{4.3786})=0.2013$

$or,\frac{x-134.915}{4.3786}=-0.84$

or, x = 134.915 - 0.84 * 4.3786

or, x = 131.24

Option-2) 131.25