In: Statistics and Probability
In a random sample of 40 dog owners enrolled in obedience training, it was determined that the mean amount of money spent per owner was $107.89 per class with a standard deviation of $8.20. Construct and interpret a 95% confidence interval for the mean amount spent per owner for an obedience class.
Solution :
Given that,
Point estimate = sample mean = = 107.89
Population standard deviation = =8.20
Sample size n =40
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 ( Using z table )
Margin of error = E = Z/2
* (
/n)
=1.96 * ( 8.20 / 40 )
= 2.50
At 95% confidence interval mean
is,
- E < < + E
107.89- 2.50 <
< 107.89+ 2.50
105.39 <
< 110.39
(105.39 ,110.39)