Question

A study of a company's practice regarding the payment of invoices revealed that on the average an invoice was paid 20 days after it was received. The standard deviation equaled five days. Assuming that the distribution is normal, what percent of the invoices were paid within 15 days of receipt?

Answer 1

Answer: 15.87%

Step-by-step explanation:

Given : A study of a company's practice regarding the payment of invoices revealed that on the average an invoice was paid 20 days after it was received.

i.e. $\mu=20$ days

$\sigma=5$ days

Z-score : $\dfrac{x-\mu}{\sigma}$

$=\dfrac{15-20}{5}=-1$

Now, the probability that the invoices were paid within 15 days of receipt is given by :-

$P(X<15)=P(z<-1)=0.1586553\approx15.87\%$

Hence, 15.87% of the invoices were paid within 15 days of receipt.