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In: Statistics and Probability

The daily net cash flows in the table below represent a 5-day sample. Use the Data...

The daily net cash flows in the table below represent a 5-day sample. Use the Data Analysis tool in Excel to calculate the 95% and 99% confidence intervals for the daily net cash flows. Along with your calculation, interpret the meaning behind your confidence interval estimates and discuss why the 99% confidence interval is wider.

Day

Net Cash Flow

1

15,000

2

17,000

3

13,000

4

20,000

5

14,000

Solutions

Expert Solution

Solution :

Interpretation of 95 % confidence interval.

The 95 % confidence interval of mean denote that if we drawn 1000 random sample then the value of 950 sample mean lies within that 95% confidence interval.

Excel provide us confidence level ,

Lower limit = mean - confidence level.

Upper limit = mean + confidence level.

orchestra answered 2 years ago
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