(1) A survey of 100 grocery stores revealed that the average price of a gallon of...

(1) A survey of 100 grocery stores revealed that the average price of a gallon of milk was $3.00, with a population standard deviation of $0.20. What is the 95% confidence interval of the true cost of a gallon of milk?

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Expert Solution

Given that,

Point estimate = sample mean = = 3.00

Population standard deviation = = 0.20

Sample size = n = 100

At 95% confidence level the z is ,

Z_/2 = Z_0.025 = 1.96

Margin of error = E = Z_/2* ( / $\sqrt$ n)

= 1.96* ( 0.20/ $\sqrt$ 100 )

= 0.039

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

- E < < + E

3.00 - 0.039 < < 3.00 + 0.039

2.96 < < 3.04

The 95% confidence interval of the true cost of a gallon of milk is ,(2.96 , 3.04)

orchestra answered 1 year ago

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