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    Normal and Lognormal Random Variable

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    The demand for electricity in megawatts at peak load on any given day is said to be described by a normal random variable with expected value 90 megawatts and standard deviation 10 megawatts (variance 100 megawatts squared). If this description of the demand for electricity is correct, what generating capacity must be available in order that the load be met 99.5 percent of the time?

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    Solution Preview

    To solve this question, you will need to use a normal distribution table, which can be found http://www.math.unb.ca/~knight/utility/NormTble.htm. It should be in the back of your book as well.

    To begin, we need ...

    Solution Summary

    Normal and lognormal random variable are examined.