Topic: From the local cable network owner or newspaper dealer collect

the information regarding the expenditure on advertisement made by 50

different shops/companies/organizations and prepare continuous
frequency distribution using expenditure as a variable. Also find the
number of companies having their expenditure between the limits
± 2σ (Normal Distribution)

CONTENT

INTRODUCTION
 Objective of the study
 Scope of the study
 Limitation of the study
 Data collection
ABOUT THE CABLE NETWORK OWNER
THEORETICAL ASPECTS
DATA ANALYSIS
DATA INTERPRETATION
 Conclusion
BIBLIOGRAPHY
 INTRODUCTION
In many natural processes, random variation conforms to a particular
probability distribution, which is the most commonly observed probability
distribution. In the early 1800’s Karl Gauss used it to analyze astronomical
among the scientific community.
Objective of the study:

The objective of the study is

• To understand what is normal distribution in an organization.
• To know importance of normal distribution and the uses of it in any organization.

Scope of the study:

• To learn the practical aspects that is going in an organization.
• To help in implementing the theoretical aspects of the subject in practical working
of the organization.

Limitation of the study:

• The study was done on the basis of details given by the employee that might
be true or wrong.
• The time limited of this study is very less

Data collection:

Primary data:
The advertising expenditure of various shops were collected from Mr. Madhu the cable
network operator of Indiranagar, Bangalore.

ABOUT THE TV CABLE OPERATOR

The cable network owner is Mr. Madhu. He provides cable network

connections to more than 400 houses. He started this business since 1990.
Mr. Madhu main income is through advertising of the local shops and other
institutes. The shops that approach him are silk saree shops, various travel
agency, jewellery shops, sapna book houses, computer centers that offer
courses, etc.,

Mr. Madhu charges for the advertising depending upon the type of
advertisement. For scrolling advertisements he charges from Rs. 2500 to Rs.
2800 and goes above that depending upon the scrolling message for one
month. For 30 seconds advertisement he charges from Rs. 5000 and
depending upon the frequency of the advertisement the rate increases.
THEORETICAL ASPECTS

The normal distribution, also called the Gaussian distribution, is an

important family of continuous probability distributions, applicable in many
fields. Each member of the family may be defined by two parameters,
location and scale: the mean ("average", μ) and variance (standard deviation
squared, σ2) respectively. The standard normal distribution is the normal
distribution with a mean of zero and a variance of one. It is often called the
bell curve because the graph of its probability density resembles a bell.

The bell shaped curve has several properties:

• The curve concentrated in the center and decreases on either side.

This means that the data has less of a tendency to produce unusually
extreme values, compared to some other distributions.
 • The bell shaped curve is symmetric. This tells you that the probability
of deviations from the mean is comparable in either direction.
• The area under the curve is 1.

The empirical rule

The empirical rule is a handy quick estimate of the spread of the data given
the mean and the standard deviation of a data set that follows the normal
distribution.

The empirical rule states that for a normal distribution:

 68% of the data will fall within 1 standard deviation of the mean.
 95% of the data will fall within 2 standard deviations of the mean.
 Almost all (99.7%) of the data will fall within 3 standard deviations is
a convenient approximation.

A standard Normal distribution curve with mean 0 and standard deviation 1

Applications of normal distribution:
To business administration:

The normal distribution has applications in many areas of business

administration. For example:

 Modern portfolio theory commonly assumes that the returns of a

diversified asset portfolio follow a normal distribution.
 In operations management, process variations often are normally
distributed.
 In human resource management, employee performance sometimes is
considered to be normally distributed.

To other fields:
The importance of the normal distribution as a model of quantitative
phenomena in the natural and behavioral sciences is due in part to the
central limit theorem. Many measurements, ranging from psychological to
physical phenomena (in particular, thermal noise) can be approximated, to
varying degrees, by the normal distribution. While the mechanisms
underlying these phenomena are often unknown, the use of the normal
model can be theoretically justified by assuming that many small,
independent effects are additively contributing to each observation. The
normal distribution is also important for its relationship to least-squares
estimation, one of the simplest and oldest methods of statistical estimation.

The normal distribution also arises in many areas of statistics. For example,
the sampling distribution of the sample mean is approximately normal, even
if the distribution of the population from which the sample is taken is not
normal. In addition, the normal distribution maximizes information entropy
among all distributions with known mean and variance, which makes it the
natural choice of underlying distribution for data summarized in terms of
sample mean and variance. The normal distribution is the most widely used
family of distributions in statistics and many statistical tests are based on the
assumption of normality. In probability theory, normal distributions arise as
the limiting distributions of several continuous and discrete families of
distributions.
Data analysis:

The advertising expenditure of 50 different shops, organisations, educational

institutions etc.,

The advertising cost varies from shops to shops.

The advertising cost for the scrolling ads, the cable network operator
charges around Rs. 2800 and for the 30 sec ads the costs starts from Rs.
5000.

Advertising expenditure (Rs) No. of shops and other organizations

 (per month)
2500 - 4500 13
4500 – 6500 5
6500 – 8500 4
8500 10500 9
10500 – 12500 7
12500 – 14500 12

Data interpretation:

x f m Fm d=(m- fd fd2
75000)/200
0
2500-4500 13 3500 45500 -2 -26 52
4500-6500 5 5500 27500 -1 -5 5
6500-8500 4 7500 30000 0 0 0
8500-10500 9 9500 85500 1 9 9
10500-12500 7 11500 80500 2 14 28
12500-14500 12 13500 162000 3 36 108
∑f=50 ∑fm=43100o ∑fd=28 ∑fd2=202

(mean) = ∑fm/∑f

=431000/ 50
 =8620

Standard deviation

S.D (σ ) =√(∑fd2 / ∑f) – (∑fd/∑f) 2

= √ (202/50) – (28 / 50)

= √4.04 – 0.3163

= √3.7237

=1.9297

The below graph shows the normal distribution curve with the mean of
8620 and s.d is 1.9297

8614 8616 8618 8620 8622 8624 8626

To find the number of companies having their expenditure between the limits
± 2σ

+ 2σ = 8620 + 2(1.9297)
= 8620 + 3.8594

= 8623.86

- 2σ = 8620 – 2(1.9297)
= 8620 – 3.8594

= 8616.14

When we take the standard normal distribution for values between

8616.14 and 8623.86
 Z= ( - µ) / σ

= (8623.86 – 8620) / 1.9297

=2

Z= ( - µ) / σ

= (8616.14 – 8620) / 1.9297

= -2

The shaded area is 0.9545

i.e 95 % of the data falls between this area.

The number of companies that lies between 8616.14 and 8623.86 are 9.

CONCLUSION

The normal distribution often is used to describe random variables,

especially those having symmetrical, unimodal distributions. In many cases
however, the normal distribution is only a rough approximation of the actual
distribution. For example, the physical length of a component cannot be
negative, but the normal distribution extends indefinitely in both the positive
and negative directions. Nonetheless, the resulting errors may be negligible
or within the acceptable limits, allowing one to solve problems with
sufficiency accuracy by assuming a normal distribution.