# Normal Distribution Analysis Of Utility Charges For One-Bedroom Apartments

## PART A

The average download time is 2 seconds and a standard deviation of 0.5 seconds.

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1. The probability that the download is above 1.8 seconds?

The probability associated with the z-score value of -0.4 is less than 0.001. Therefore, the probability of the download time being above 1.8 seconds is above 0.999.

1. The probability that the download is between 1.5 and 2.5

The probability of the download time is between 1.5 and 2.5 seconds is

1. 99% of the download times are slower than how many seconds?

PART B  Introduction

Normal distribution is among the most used distributions in statistics. Their distribution can be in different formats based on the mean and standard deviation. These statistics determine the position and the shape. A widely distributed population has a normal distribution which has a large kurtosis and longer tails. In addition, a population whose values are not approximately distributed around the mean has a skewness statistic which is not equivalent to zero[1].

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A negative and positive skew indicates that the left and right tail are longer respectively – hence the mean and median statistics are not equal. Therefore, using lower and higher moments of statistics, the distribution of data can be effectively described. In a normally distributed population, respective probability values can be estimated using the standard normal and inverse standard normal tables[2]. There are various theoretical assumptions which can be used in determining whether a sample is skewed or approximately normal. Also, boxplots, histograms and QQ-plots can be used to check normality. In this paper, we will use the standard normal table, boxplot, histogram and QQ-plot to check for normality of utility charges (electricity costs) of one-bedroom units in a certain city.

Results & Discussions

1. Constructing Boxplot

Table 1: Summary statistics of Utility charges (Electricity costs)

[1] Abdal-sahib et al., “Testing for Normality.”[2] Fletcher, “Normal Distribution.”        Figure 1: Boxplot of Electricity costs in dollarsAccording to figure 1 above, utility charges on electricity use seems to be approximately normal because the median approximately divides the dataset into two equal sections. In addition, the data does not have extreme values which could be affecting the distribution of the electricity charges. Therefore, as it has been observed in the summary statistics – mean and the median values are close to each other, the boxplot affirms the data is approximately normally distributed.

• Constructing Histogram

Table2: Histogram frequency table  Figure 2: Unsorted Histogram of Utility Charges (Electricity costs)

Figure 2 above is a histogram chart with values of the electricity costs for the people in the city. The histogram was plotted by using bins with differences of 10 from 80 to 220. The selection of the bins was guided by the minimum and the maximum values. Most of the electricity bills were between 140 and 140 dollars which had a frequency of 8 one-bedroomed apartments. According to the distribution of the frequency in the histogram table and chart above, we can confirm that the data is approximately equally distributed around the arithmetic mean[1].  [1] Scott, “Histogram.”

Figure 3: Sorted Histogram with Cumulative frequencies

The sorted histogram above represents the bins in a chart from the one with the highest frequency to the least. One-bedroom units in the 150, 130, 160, 170, 120 and 180 categories cover 56% of the entire sample. 220 category had the least frequency and 150 had the highest.

1. Data Characteristics and Theoretical Properties

On average, the amount (in dollars) a resident in the city pays for the electricity is 147.06 dollars with a standard deviation of 31.691 dollars. There is no much difference between the average value and the median, indicating that the data is not highly skewed, hence approximately normally distributed. Based on the skewness statistics which is 0.016, we can conclude the data is slightly skewed to the right. The kurtosis is less than three hence concluding that the distribution has less extreme values as compared to the standard normal distribution, hence the peak is sharper. An individual who pays the highest amount of electricity cost in the city pays around 213 dollars. In the same way, the least amount paid based on the sample was 82 dollars.

The interquartile range is 42.75, which is approximately equal to the theoretical assumption that it should be 1.33 times the standard deviation (42.15). The range statistic for the one-bedroom electricity costs is 131 and the theoretical assumption that it should be 6 times the standard deviation has not been met (6 times of standard deviation is 190.146). There are 34 values between negative and positive 1 standard score, which translate to 68%, hence the theoretical assumption is met. 40 values lie between negative and positive 1.28 which is 80% as defined in the normality theory. There are 48 values between negative and positive 2 which translates to 96%, hence the confirmation according to standard normal assumptions.

1. Quantile-Quantile Normal Probability Plot

Table 3: Cumulative Distribution Function and Standardized Values

 Utility Charge (Electricity Costs) Mean 147.06 Standard Error 4.482 Median 148.5 Mode 130 Standard Deviation 31.691 Sample Variance 1004.343 Kurtosis -0.544 Skewness 0.016 Range 131 Minimum 82 1st quartile 126 3rd Quartile 168.75 Maximum 213 Sum 7353 Count 50 Unsorted Bin Frequency Cumulative % Sorted Bin Frequency Cumulative % 80 0 0% 150 8 16% 90 2 4% 130 6 28% 100 2 8% 160 5 38% 110 3 14% 170 5 48% 120 4 22% 120 4 56% 130 6 34% 180 4 64% 140 3 40% 110 3 70% 150 8 56% 140 3 76% 160 5 66% 190 3 82% 170 5 76% 90 2 86% 180 4 84% 100 2 90% 190 3 90% 200 2 94% 200 2 94% 210 2 98% 210 2 98% 220 1 100% 220 1 100% 80 0 100% More 0 100% More 0 100%
 i Utility Charge CDF Z- Score Standardized Values 1 82 0.01 -2.32635 -65.06 2 90 0.03 -1.88079 -57.06 3 95 0.05 -1.64485 -52.06 4 96 0.07 -1.47579 -51.06 5 102 0.09 -1.34076 -45.06 6 108 0.11 -1.22653 -39.06 7 109 0.13 -1.12639 -38.06 8 111 0.15 -1.03643 -36.06 9 114 0.17 -0.95417 -33.06 10 116 0.19 -0.87790 -31.06 11 119 0.21 -0.80642 -28.06 12 123 0.23 -0.73885 -24.06 13 127 0.25 -0.67449 -20.06 14 128 0.27 -0.61281 -19.06 15 129 0.29 -0.55338 -18.06 16 130 0.31 -0.49585 -17.06 17 130 0.33 -0.43991 -17.06 18 135 0.35 -0.38532 -12.06 19 137 0.37 -0.33185 -10.06 20 139 0.39 -0.27932 -8.06 21 141 0.41 -0.22754 -6.06 22 143 0.43 -0.17637 -4.06 23 144 0.45 -0.12566 -3.06 24 147 0.47 -0.07527 -0.06 25 148 0.49 -0.02507 0.94 26 149 0.51 0.02507 1.94 27 149 0.53 0.07527 1.94 28 150 0.55 0.12566 2.94 29 151 0.57 0.17637 3.94 30 153 0.59 0.22754 5.94 31 154 0.61 0.27932 6.94 32 157 0.63 0.33185 9.94 33 158 0.65 0.38532 10.94 34 163 0.67 0.43991 15.94 35 165 0.69 0.49585 17.94 36 166 0.71 0.55338 18.94 37 167 0.73 0.61281 19.94 38 168 0.75 0.67449 20.94 39 171 0.77 0.73885 23.94 40 172 0.79 0.80642 24.94 41 175 0.81 0.87790 27.94 42 178 0.83 0.95417 30.94 43 183 0.85 1.03643 35.94 44 185 0.87 1.12639 37.94 45 187 0.89 1.22653 39.94 46 191 0.91 1.34076 43.94 47 197 0.93 1.47579 49.94 48 202 0.95 1.64485 54.94 49 206 0.97 1.88079 58.94 50 213 0.99 2.32635 65.94

Fletcher, “Normal Distribution.”

Figure 4: QQ Plot of Utility Charges (Electricity Costs)

In the development of the QQ-plot in figure 4 above, cumulative probabilities, z-scores and standardized values were calculated and represented in the plot. The x-axis represents the z-scores and the y-axis is the standardized values for the electricity costs. According to the QQ-plot above, the standardized values seems to be following a straight line, hence the conclusion that the data is approximately normally distributed[1]. It can also be observed that most of the standard values are concentrated around the standard mean, which is zero. In addition, the deviations (standard values) from the mean are approximately distributed equally from the mean, hence proving that the data is not skewed or rather if it is skewed, the skewness does not affect the distribution.

Conclusion

In conclusion, usage of electricity on the city in one-bedroom apartments is approximately normally distributed with no extreme values. Most of the house units (one-bedroom) pay for electricity between 120 to 200 dollars. Finally, usage of electricity in the city for one-bedroomed apartments does not differ extensively from one unit to another and the distribution produces less extreme values (outliers) compared to the ideal standard normal. Using standard normal tables, histogram, and boxplot, we conclude that the data is normally distributed. Therefore, the results from these methods are homogenous.

Abdal-sahib, Reem, Shahah Musaed Altammar, Haffiezhah An-nadiah Azlan, Ali Aytemur, Stephanie Balters, Martin Steinert, Christo A. Bisschoff, et al. “Testing for Normality.” Frontiers in Psychology 98, no. 1 (2013): 1–8.

Fletcher, J. “Normal Distribution.” BMJ 338, no. feb18 2 (February 18, 2009): b646–b646.

Oldford, R. Wayne. “Self-Calibrating Quantile–Quantile Plots.” American Statistician 70, no. 1 (2016): 74–90.

Scott, David W. “Histogram.” Wiley Interdisciplinary Reviews: Computational Statistics 2, no. 1 (2010): 44–48.

Oldford, “Self-Calibrating Quantile–Quantile Plots.”