Question

A bank's loan officer rates applicants using their FICO credit score. The ratings are normally distributed with a mean of 711 and a standard deviation of 80. Find the credit score which separates the lower 80% from the top 20%. g

Answer 1

The answer is "778"

Explanation:

Given value:

`\to \mu= 711\\\\\to \sigma= 80\\\\\to P(Z >0.84) = 0.20\\\\\to z = 0.84`

The formula for z-score:

`\to x = z * \sigma + \mu \\\\\to x = 0.84 * 80 + 711 \\\\ \to x=67.2 +711\\\\ \to x= 778.2\\\\ \to x= 778`