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Excel Primer on Common Probability Distributions

The document provides detailed information on various statistical functions in Excel, including NORMDIST, NORMINV, NORMSINV, POISSON.DIST, BINOM.DIST, and EXPON.DIST, explaining their syntax, arguments, and usage. It emphasizes that these functions have been replaced by newer versions that may offer improved accuracy and should be used for future compatibility. Each function is accompanied by examples illustrating how to implement them in Excel.

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0% found this document useful (0 votes)
10 views12 pages

Excel Primer on Common Probability Distributions

The document provides detailed information on various statistical functions in Excel, including NORMDIST, NORMINV, NORMSINV, POISSON.DIST, BINOM.DIST, and EXPON.DIST, explaining their syntax, arguments, and usage. It emphasizes that these functions have been replaced by newer versions that may offer improved accuracy and should be used for future compatibility. Each function is accompanied by examples illustrating how to implement them in Excel.

Uploaded by

lkn1151320
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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NORMDIST function

Returns the normal distribution for the specified mean and standard deviation. This function has a
very wide range of applications in statistics, including hypothesis testing.

Important: This function has been replaced with one or more new functions that may provide
improved accuracy and whose names better reflect their usage. Although this function is still
available for backward compatibility, you should consider using the new functions from now on,
because this function may not be available in future versions of Excel.

For more information about the new function, see NORM.DIST function.

Syntax

NORMDIST(x,mean,standard_dev,cumulative)

The NORMDIST function syntax has the following arguments:

• X Required. The value for which you want the distribution.

• Mean Required. The arithmetic mean of the distribution.

• Standard_dev Required. The standard deviation of the distribution.

• Cumulative Required. A logical value that determines the form of the function. If
cumulative is TRUE, NORMDIST returns the cumulative distribution function; if FALSE, it
returns the probability mass function.

Remarks

• If mean or standard_dev is nonnumeric, NORMDIST returns the #VALUE! error value.

• If standard_dev ≤ 0, NORMDIST returns the #NUM! error value.

• If mean = 0, standard_dev = 1, and cumulative = TRUE, NORMDIST returns the standard


normal distribution, NORMSDIST.

• The equation for the normal density function (cumulative = FALSE) is:
• When cumulative = TRUE, the formula is the integral from negative infinity to x of the given
formula.

Example

Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For
formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust
the column widths to see all the data.

Data Description

42 Value for which you want the distribution

40 Arithmetic mean of the distribution

1.5 Standard deviation of the distribution

Formula Description Result

=NORMDIST(A2,A3,A4,TRUE) Cumulative distribution function for the terms above 0.9087888

=NORMDIST(A2,A3,A4,FALSE) Probability mass function for the terms above 0.10934


NORMINV function

Returns the inverse of the normal cumulative distribution for the specified mean and standard
deviation.

Note: This function has been replaced with one or more new functions that may provide improved
accuracy and whose names better reflect their usage. Although this function is still available for
backward compatibility, you should consider using the new functions from now on, because this
function may not be available in future versions of Excel.

For more information about the new function, see NORM.INV function.

Syntax

NORMINV(probability,mean,standard_dev)

The NORMINV function syntax has the following arguments:

• Probability Required. A probability corresponding to the normal distribution.

• Mean Required. The arithmetic mean of the distribution.

• Standard_dev Required. The standard deviation of the distribution.

Remarks

• If any argument is nonnumeric, NORMINV returns the #VALUE! error value.

• If probability <= 0 or if probability >= 1, NORMINV returns the #NUM! error value.

• If standard_dev ≤ 0, NORMINV returns the #NUM! error value.

• If mean = 0 and standard_dev = 1, NORMINV uses the standard normal distribution (see
NORMSINV).

Given a value for probability, NORMINV seeks that value x such that NORMDIST(x, mean,
standard_dev, TRUE) = probability. Thus, precision of NORMINV depends on precision of NORMDIST.
NORMINV uses an iterative search technique. If the search has not converged after 100 iterations,
the function returns the #N/A error value.

Example
Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For
formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust
the column widths to see all the data.

Data Description

0.908789 Probability corresponding to the normal distribution

40 Arithmetic mean of the distribution

1.5 Standard deviation of the distribution

Formula Description Result

=NORMINV(A2,A3,A4) Inverse of the normal cumulative distribution for the terms above 42.000002
NORMSINV function

Returns the inverse of the standard normal cumulative distribution. The distribution has a mean of
zero and a standard deviation of one.

Important: This function has been replaced with one or more new functions that may provide
improved accuracy and whose names better reflect their usage. Although this function is still
available for backward compatibility, you should consider using the new functions from now on,
because this function may not be available in future versions of Excel.

For more information about the new function, see NORM.S.INV function.

Syntax

NORMSINV(probability)

The NORMSINV function syntax has the following argument:

• Probability Required. A probability corresponding to the normal distribution.

Remarks

• If Probability is nonnumeric, NORMSINV returns the #VALUE! error value.

• If Probability <= 0 or if Probability >= 1, NORMSINV returns the #NUM! error value.

Given a value for Probability, NORMSINV seeks that value z such that NORMSDIST(z) = probability.
Thus, precision of NORMSINV depends on precision of NORMSDIST. NORMSINV uses an iterative
search technique. If the search has not converged after 100 iterations, the function returns the #N/A
error value.

Example

Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For
formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust
the column widths to see all the data.
Formula Description Result

Inverse of the standard normal cumulative distribution, with a


=NORMSINV(0.9088) 1.3334
probability of 0.9088.
POISSON.DIST function

Returns the Poisson distribution. A common application of the Poisson distribution is predicting the
number of events over a specific time, such as the number of cars arriving at a toll plaza in 1 minute.

Syntax

POISSON.DIST(x,mean,cumulative)

The POISSON.DIST function syntax has the following arguments:

• X Required. The number of events.

• Mean Required. The expected numeric value.

• Cumulative Required. A logical value that determines the form of the probability
distribution returned. If cumulative is TRUE, POISSON.DIST returns the cumulative Poisson
probability that the number of random events occurring will be between zero and x inclusive;
if FALSE, it returns the Poisson probability mass function that the number of events occurring
will be exactly x.

Remarks

• If x is not an integer, it is truncated.

• If x or mean is nonnumeric, POISSON.DIST returns the #VALUE! error value.

• If x < 0, POISSON.DIST returns the #NUM! error value.

• If mean < 0, POISSON.DIST returns the #NUM! error value.

• POISSON.DIST is calculated as follows.

For cumulative = FALSE:

For cumulative = TRUE:


Example

Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For
formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust
the column widths to see all the data.

Data Description

2 Number of events

5 Expected mean

Formula Description R esult

Cumulative Poisson probability with the arguments


=POISSON.DIST(A2,A3,TRUE) 0.124652
specified in A2 and A3.

Poisson probability mass function with the arguments


=POISSON.DIST(A2,A3,FALSE) 0.084224
specified in A2 and A3.
BINOM.DIST function

Returns the individual term binomial distribution probability. Use BINOM.DIST in problems with a
fixed number of tests or trials, when the outcomes of any trial are only success or failure, when trials
are independent, and when the probability of success is constant throughout the experiment. For
example, BINOM.DIST can calculate the probability that two of the next three babies born are male.

Syntax

BINOM.DIST(number_s,trials,probability_s,cumulative)

The BINOM.DIST function syntax has the following arguments:

• Number_s Required. The number of successes in trials.

• Trials Required. The number of independent trials.

• Probability_s Required. The probability of success on each trial.

• Cumulative Required. A logical value that determines the form of the function. If
cumulative is TRUE, then BINOM.DIST returns the cumulative distribution function, which is
the probability that there are at most number_s successes; if FALSE, it returns the probability
mass function, which is the probability that there are number_s successes.

Remarks

• Number_s and trials are truncated to integers.

• If number_s, trials, or probability_s is nonnumeric, BINOM.DIST returns the #VALUE! error


value.

• If number_s < 0 or number_s > trials, BINOM.DIST returns the #NUM! error value.

• If probability_s < 0 or probability_s > 1, BINOM.DIST returns the #NUM! error value.

• The binomial probability mass function is:

where:
is COMBIN(n,x).

The cumulative binomial distribution is:

Example

Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For
formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust
the column widths to see all the data.

Data Description

6 Number of successes in trials

10 Number of independent trials

0.5 Probability of success on each trial

Formula Description Result

=BINOM.DIST(A2,A3,A4,FALSE) Probability of exactly 6 of 10 trials being successful. 0.2050781


EXPON.DIST function

This article describes the formula syntax and usage of the EXPON.DIST function in Microsoft Excel.

Returns the exponential distribution. Use EXPON.DIST to model the time between events, such as
how long an automated bank teller takes to deliver cash. For example, you can use EXPON.DIST to
determine the probability that the process takes at most 1 minute.

Syntax

EXPON.DIST(x,lambda,cumulative)

The EXPON.DIST function syntax has the following arguments:

• X Required. The value of the function.

• Lambda Required. The parameter value.

• Cumulative Required. A logical value that indicates which form of the exponential
function to provide. If cumulative is TRUE, EXPON.DIST returns the cumulative distribution
function; if FALSE, it returns the probability density function.

Remarks

• If x or lambda is nonnumeric, EXPON.DIST returns the #VALUE! error value.

• If x < 0, EXPON.DIST returns the #NUM! error value.

• If lambda ≤ 0, EXPON.DIST returns the #NUM! error value.

• The equation for the probability density function is:

• The equation for the cumulative distribution function is:

Example
Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For
formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust
the column widths to see all the data.

Data Description

0.2 Value of the function

10 Parameter value

Formula Description Result

=EXPON.DIST(A2,A3,TRUE) Cumulative exponential distribution function 0.86466472

=EXPON.DIST(0.2,10,FALSE) Probability exponential distribution function 1.35335283

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