Question

With some interest in running your own candy store and a decent credit rating, you can probably get a bank loan for franchises such as Candy Express, The Fudge Company, Karmel Corn, and Rocky Mountain Chocolate Factory. Startup costs (in thousands of dollars) for a random sample of candy stores are given below. Assume start up costs follow an approximately normal distribution. 95, 110, 129, 95, 75, 94, 116, 100, 85 (a) Find a 90% Confidence Interval for the population mean startup cost μ for candy store franchises. Name the Confidence Interval. (6 pts) (b) State a Conclusion in a complete sentence about the meaning of this confidence interval and use the appropriate wording for the 3 parts:

Answer 1

Let the variable X denote the start up costs for candy store franchises.

sample mean:

sample standard deviation:

sample size:

Here the significance level:

degrees of freedom=

Here, we use t-statistic.

90% confidence interval for population mean startup cost   for candy store franchises is:

  

[ , calculated from the t distribution table ]

Conclusion: We are 90% confident that the true population mean of the start up cost for candy store franchises lie in this interval.

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