Question

Give an example of an interval estimate of an average or proportion you may use in your daily life. For instance, you may say that you are pretty sure your average commute time is between 25-30 minutes, or you are fairly confident that between 60-65% of the population love dogs. Collect some data to see how well your intuition is working. First, does your sample data meet all assumptions necessary to construct the confidence interval of the type you need? Even if it doesn’t, construct and interpret the confidence interval.

Answer 1

Let us assume that the monthly rent for a house is normally distributed.

Let's say for sample of 16 houses are selected at random, with

sample mean $1010 and standard deviation $280 .

We have to find 95% confidence interval for mean rent.

Below is the calculations and interpretation of 95% confidence interval.

Interpretation,

We are 95% confident that mean monthly rent lie in between $872.8 and $1147.2