Again using the data from Example 20.1 and question 18, construct a 95 %

confidence interval.

Example 20.1

Simple Random Sampling to Determine Household Income. Suppose an investment adviser is trying to decide whether a small retirement community consisting of 1,000 residents represents a promising source of potential clients. To determine the potential business, the investment adviser decides to analyze the size of the residents’ investment portfolios. A random sample of 75 residents, who were able to respond anonymously, produces a sample mean of $375,000 with a sample standard deviation of $120,000.
We can use this information to construct a 95 % confidence interval for the mean value of the investment portfolio:

Transcribed Image Text:

f(x) x-Zal2 O Fig. 20.1 Confidence interval estimate for population mean N = 1,000 n = 75 x = $375,000 s = $120,000 x + Z/2 oz X