00:01
An article about the cost of health care in money magazine reported that a visit to the hospital emergency room, as simple as a sore throat, has a mean cost of $328.
00:12
And it says, assume that the cost for this type of hospital emergency treatment is normally distributed with a standard deviation of $92.
00:26
And again, we're assuming it's normal.
00:28
And it says, answer the following questions about the cost of the hospital emergency room visit.
00:34
And so part a says, what is the probability that the cost is more than $500? so we would convert that to a z -value and take the 500 minus the 328 divided by 92.
00:50
So 500 minus that 328 divided by 92 is a value of about 1 .87.
01:01
And so i'm going to actually look up the area below negative 1 .87.
01:06
And that value is 0 .0307.
01:12
So about a 3 % chance of that happening.
01:16
Now on part b, it says, what is the probability that the cost will be less than $250? and again, we'll convert that to a z -value.
01:31
And all we're going to do is change that value to $250.
01:34
So i can do a little second entry and change that one value to a $250.
01:39
And that z -value corresponds to negative 0 .85 approximately.
01:44
So looking up negative 0 .85 in my table, i'm using an online table, 0, 1, 2, 3, 4, 5, 0 .1977.
02:00
And finally, we have part, i guess we have a couple more parts.
02:05
Part c asks us, what is the probability that the cost will be less than $250? well, we just did that one.
02:14
So what is the cost that is between $300 and $400? between $300 and $400.
02:23
And so again, i'm just going to go back and change this one into these two values.
02:29
And then we'll have the lower z -value.
02:32
So for $300, that is a value of negative 0 .30...