Question

A market research firm supplies manufacturers with estimates of the retail sales of their products from samples of retail stores. Marketing managers are prone to look at the estimate and ignore sampling error. An SRS of 13 13 stores this year shows mean sales of 65 65 units of a small appliance, with a standard deviation of 7.4 7.4 units. During the same point in time last year, an SRS of 22 22 stores had mean sales of 57.822 57.822 units, with standard deviation 14.7 14.7 units. An increase from 57.822 57.822 to 65 65 is a rise of about 11%.

1. Construct a 95% confidence interval estimate of the difference μ1−μ2 μ 1 − μ 2 , where μ1 μ 1 is the mean of this year's sales and μ2 μ 2 is the mean of last year's sales.

(b) The margin of error is

Answer 1