An online travel agent who specializes in cruises wanted to compare the cost of cruising to different destinations on various cruise lines. The following random sample data show the average cost of a seven-day cruise in a standard room to Alaska vs. the average cost of a seven-day cruise in a standard room to the Caribbean. Assume the population variances for cruise fares for these destinations are equal.

Alaska Caribbean Sample mean $994 $925 Sample standard deviation $135 $128 Sample size 9 12

a. Construct a 95% confidence interval to estimate the difference between the average rates of cruising to Alaska vs. cruising to the Caribbean.

b. What conclusions can be made about the difference in rates between these destinations?

c. What assumptions need to be made in order to perform this procedure?

AppendixLO1