Question

​​​​​​A confidence interval is desired for the true average sale volume. Assume that the population standard deviation is known to be 3. How large a random sample is needed to construct a 99% interval for the true average sale volume with a margin of error equal to 1?

Answer 1

Solution :

Given that,

Population standard deviation = = 3

Margin of error = E = 1

At 99% confidence level the z is,

= 1 - 99%

= 1 - 0.99 = 0.01

/2  = 0.005

Z_/2 = Z _0.005 = 2.576

sample size = n = [Z_/2* / E] ²

n = [2.576 * 3 / 1 ]²

n = 59.72

Sample size = n = 60