Q. 3. Consider the sample of 850 past negligence cases. Suppose you are willing to let the 75% estimate be within .03 (3%) of the true proportion. You are willing to assume a 95% confidence.

1. Is 850 an adequate sample size for the estimate of 75%? Show why or why not.

1. Construct a 95% confidence interval on the estimate of 75%. How would you interpret it?

Q. 4. Determine the expected value of the amount that could be paid to Louis Matthew in a settlement. Use the 75% probability figure. Also, determine a maximum and minimum expected value for the settlement figure based on the confidence interval above. Be sure to include all of the damages Louis Matthew will be able to recover. How would you interpret your expected values?