Question

You are looking into selling prices of Subaru Outback from a website where users report their prices. Assume that these prices are truthfully reported and follow Normal distribution.

a. a. When you collected 24 reports, the sample mean price was found to be $36,000. The population standard deviation was $900. Identify the two-sided 99% confidence interval of the population mean price.

b. In order to achieve $500 as your width of confidence interval at 99% when the population standard deviation is $900, what is the sample size you need?

c. Based on information on part a, does the sample data contradict the fact that the sample average is not equal to average history data of prices which is equal to $37,000 using 95% confidence level?

d. How your answer to part c will be changed if instead of population S.D, sample S.D is $900?

Answer 1