Question: Using Excel to Find Critical Values Excel's NORM.S.INV function (inverse of the standard normal distribution) is used to find a critical value a/2. In using

Using Excel to Find Critical Values Excel's NORM.S.INV function (inverse of the standard normal distribution) is used to find a critical value a/2. In using this function, it is very helpful to refer to Figure 7-1 or Figure 7-2 to see the relationships among the confidence level, the val- ues of a and a/2, and the critical value. Use the following procedure. 1. Given a confidence level, such as 95%, first express the confidence level as a decimal, such as 0.95. 2. Find the value of "1- confidence level" expressed as a decimal, and denote that value by a. For a confidence level of 95%, a = 1 = 0.95 0.05. 3. Find the value of a/2, which is a decimal number, such as 0.025. 4. Subtract the result from Step 3 from 1 to get a value of I if a 0.05, the value of 1 a/2 is 1 0.025 = 0.975. a/2. For example, 5. The Excel function NORM.S.INV is now used to find the z score correspond- ing to the result from Step 4. First, click the Insert Function f, button in the Formula Bar. 6. The Insert Function dialog box now appear

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!