Question

the Nellie Mae organization conducts an extensive annual study of credit carx usage by college students. for their 2004 study; they analyzed credit bureau data for a random sample of 1413 undergraduate students between the ages of 18 and 24 . they found that 76% of the students sampled held a credit card. determine this results margin of error woth 99% confidence.

Answer 1

Solution :

Given that,

n = 1413

Point estimate = sample proportion = = 0.76

1 - = 1 - 0.76 = 0.24

At 99% confidence level

= 1 - 99%

=1 - 0.99 =0.01

/2 = 0.005

Z/2 = Z0.005  = 2.576

Margin of error = E = Z / 2 * (( * (1 - )) / n)

= 2.576 (((0.76 * 0.24) / 1413)

= 0.029