A new phone system was installed last year to help reduce the expense of personal calls that were being madeby employees. Before the new system was installed, the amount being spent on personal calls follows a normaldistribution with an average of $900 per month and a standard deviation of $50 per month. Refer to suchexpenses as PCEʹs (personal call expenses). Find the probability that a randomly selected month had a PCE thatfalls below $750.
A) 0.0013
B) 0.8333
C) 0.1667
D) 0.9987

Question

Quizplus · Accepted Answer

The probability that a randomly selected month had a PCE that falls below $750 is 0.0013. This is because the z-score for a PCE of $750 is (750 - 900) / 50 = -3, and the probability of a z-score less than -3 is 0.0013.

A New Phone System Was Installed Last Year to Help