Costs are rising for all kinds of medical care. The mean monthly rent at assisted-living facilities was reported to have increased 17% over the last five years to $3,486 (The Wall Street Journal October 27, 2012). Assume this cost estimate is based on a sample of 120 facilities. From past studies, it can be assumed that the population standard deviation is σ = $650.
a. Develop a 90% confidence interval estimate of the population mean monthly rent.
b. Develop a 95% confidence interval estimate of the population mean monthly rent.
c. Develop a 99% confidence interval estimate of the population mean monthly rent.
d. What happens to the width of the confidence interval as the confidence level is increased? Does this seem reasonable? Explain.