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In: Statistics and Probability

The housing market has recovered slowly from the economic crisis of 2008.​ Recently, in one large​...

The housing market has recovered slowly from the economic crisis of 2008.​ Recently, in one large​ community, realtors randomly sampled 3434 bids from potential buyers to estimate the average loss in home value. The sample showed the average loss was $8637 with a standard deviation of $1396.

Find a 95% confidence interval for the mean loss in value per home.

($___ , $___) round to the nearest whole number as needed

Solutions

Expert Solution

Solution :

Given that,

= $8637

= $1396

n = 3434

At 95% confidence level the z is ,

= 1 - 95% = 1 - 0.95 = 0.05

/ 2 = 0.05 / 2 = 0.025

Z/2 = Z0.025 = 1.96

Margin of error = E = Z/2* ( /n)

=1.96 * (1396 / 3434)

= 47

At 95% confidence interval estimate of the population mean is,

- E < < + E

8637 - 47 < < 8637 + 47

8590< < 8684

($8590, $8684)

orchestra answered 2 years ago
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