Question

You want to obtain a sample to estimate how much parents spend on their kids birthday parties. Based on previous study, you believe the population standard deviation is approximately σ = 32.5 σ = 32.5 dollars. You would like to be 99% confident that your estimate is within 3 dollar(s) of average spending on the birthday parties. How many parents do you have to sample?

Answer 1

Solution :

Given that,

standard deviation =s =   =32.5

Margin of error = E = 3

At 99% confidence level the z is,

= 1 - 99%

= 1 - 0.99 = 0.01

/2 = 0.005

Z/2 = 2.58

sample size = n = [Z/2* / E] 2

n = ( 2.58*32.5 /3 )2

n =781.20

Sample size = n =781