Question

Problem Page A certain brokerage house wants to estimate the mean daily return on a certain stock. A random sample of 14 days yields the following return percentages: 0.89, -0.27, -2.76, 0.08, 2.29, 2.92, -0.21, -2.69, -2.46, 2.19, -1.58, 1.76, -1.77, 2.57 If we assume that the returns are normally distributed, find a 95 % confidence interval for the mean daily return on this stock. Then complete the table below. Carry your intermediate computations to at least three decimal places. Round your answers to one decimal place. (If necessary, consult a list of formulas.)

What is the lower limit of the confidence interval?

What is the upper limit of the confidence interval?

Answer 1

Solution:-

95% confidence interval for the mean daily return on this stock is C.I = (- 1.1, 1.3)

Yields
Mean	0.068571
Standard Error	0.552981
Median	-0.065
Mode	-
Standard Deviation	2.069065
Sample Variance	4.281029
Kurtosis	-1.56968
Skewness	-0.05883
Range	5.68
Minimum	-2.76
Maximum	2.92
Sum	0.96
Count	14

C.I = 0.06857 + 2.161 × 0.55298

C.I = 0.06857 + 1.195

C.I = (- 1.126, 1.264)

The lower limit of the confidence interval is -1.1.

The upper limit of the confidence interval is 1.3.