In: Statistics and Probability
You have restaurants in two major cities. You want to test out a
new menu item. You offer a small sample to a random sample of
customers in each city. You are interested in estimating the
overall difference in proportion of customers between the two
cities who would purchase this new item. In the first city, 64 out
of 148 said that they would purchase the item if it was available.
In the second city, 80 out of 302 said yes.
Estimate the overall difference in proportions of customers who
would buy this product between the two cities. Use a 90% confidence
level.
a) State the parameter of interest. Verify that the necessary conditions are present in order to carry out the procedure.
b) Find the margin of error.
EBP=
c) Write out the confidence interval: (,)
d) Interpret the 90% confidence interval in context.
Let denote the proportions of people who said that they would purchase the item if it was available in two cities respectively.