Question

Health insurers are beginning to offer telemedicine services online that replace the common office visit. A company provides a video service that allows subscribers to connect with a physician online and receive prescribed treatments. The company claims that users of its online service saved a significant amount of money on a typical visit. The data shown below ($), for a sample of 20 online doctor visits, are consistent with the savings per visit reported by the company.

94	36	42	107
85	57	58	51
42	78	50	98
95	76	75	80
95	102	55	84

Assuming the population is roughly symmetric, construct a 95% confidence interval for the mean savings in dollars for a televisit to the doctor as opposed to an office visit. (Round your answers to the nearest cent.)

Answer 1

Solution: The mean and standard deviation of the given data is:

The formula for finding the 95% confidence interval is:

Where:

is the critical value at 0.05 significance level for df=n-1=20-1=19

Now, the 95% confidence interval is:

Therefore, the 95% confidence interval for the mean savings in dollars for a tele-visit to the doctor, as opposed to an office visit, is