Question

# Banking fees have received much attention during the recent economic recession as banks look for ways...

Banking fees have received much attention during the recent economic recession as banks look for ways to recover from the crisis. A sample of 34customers paid an average fee of \$12.23

per month on their​ interest-bearing checking accounts. Assume the population standard deviation is

​\$1.671.67.

Complete parts a and b below.

a. Construct a9 5​% confidence interval to estimate the average fee for the population.The 95​% confidence interval has a lower limit of\$_____and an upper limit of​\$____

​(Round to the nearest cent as​ needed.)

b. What is the margin of error for this​ interval?

​(Round to the nearest cent as​ needed.)

#### Homework Answers

Answer #1

Solution :

Given that,

Point estimate = sample mean = = 12. 23

Population standard deviation = = 1.67

Sample size = n = 34

At 95% confidence level the z is ,

= 1 - 95% = 1 - 0.95 = 0.05

/ 2 = 0.05 / 2 = 0.025

Z/2 = Z0.025 = 1.96

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

= 1.96* ( 1.67 / 34)

= 0.561

At 95% confidence interval estimate of the population mean is,

- E < < + E

12. 23- 0.561 < < 12.23 + 0.561

11. 669< < 12.791

(11. 67, 12.79 )

The 99% confidence level has a lower limit of \$11.67 and an upper limit of \$12.79

b)

The margin error for this interval is =0.561

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