The Internal Revenue Service reports that the mean federal income tax paid in a recent year was
Question:
The Internal Revenue Service reports that the mean federal income tax paid in a recent year was $8040. Assume that the standard deviation is $5000. The IRS plans to draw a sample of 1000 tax returns to study the effect of a new tax law.
a. What is the probability that the sample mean tax is less than $8000?
b. What is the probability that the sample mean tax is between $7600 and $7900?
c. Find the 40th percentile of the sample mean.
d. Would it be unusual if the sample mean were less than $7500?
e. Can you tell whether it would be unusual for an individual to pay a tax of less than $7500? Explain.
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