SOLUTION: A tire manufacturer believes the tread life of snow tires has a normal distribution with mean of 32000 and standard deviation of 7000 miles.If the dealer is willing to give refunds

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Question 438102: A tire manufacturer believes the tread life of snow tires has a normal distribution with mean of 32000 and standard deviation of 7000 miles.If the dealer is willing to give refunds to no more than 1 in 50 tires sold ,what mileage can he guarantee each tire to last?
Answer by stanbon(75887) (Show Source):
You can put this solution on YOUR website!
A tire manufacturer believes the tread life of snow tires has a normal distribution with mean of 32000 and standard deviation of 7000 miles.If the dealer is willing to give refunds to no more than 1 in 50 tires sold ,what mileage can he guarantee each tire to last?
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1/50 is 2%
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Find the z-value with a left-tail of 98%
invNorm(0.98) = 2.0537
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solve for the corresponding x-value:
x = zs + u
x = 2.04537*7000+32000
x = 46376.24 miles (the mileage he can guarantee)
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Cheers,
Stan H.
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