Log-Normal Distribution

Log-Normal Distribution

A distribution is considered log-normal when the Log of the given random variables follows a normal distribution.

1. It is similar to a right-skewed normal distribution and has similar parameters
2. Here the tail doesn’t merge and stretches longer.
3. It represents a random variable that is always positive and skewed in nature.
4. Example — If the log of income of people is plotted in the X axis, it will follow a log-normal distribution. It will show that too few people make less money, the majority earn normal incomes, and a small number earn very high incomes. As the income increases the number of people in that range will decrease.