Question

From a random sample of 25 stores, french bread prices have a mean of $1.50 and a standard deviation of $0.20. What is the lower and upper bounds for a 90% confidence interval of the population mean price.

Round your answer to the nearest hundredth.

Answer 1

Confidence interval for Population mean is given as below:

Confidence interval = Xbar ± t*S/sqrt(n)

From given data, we have

Xbar = 1.5

S = 0.2

n = 25

df = n – 1 = 24

Confidence level = 90%

Critical t value = 1.7109

(by using t-table)

Confidence interval = Xbar ± t*S/sqrt(n)

Confidence interval = 1.5 ± 1.7109*0.2/sqrt(25)

Confidence interval = 1.5 ± 0.0684

Lower limit = 1.5 - 0.0684 = 1.4316

Upper limit = 1.5 + 0.0684 = 1.5684

Confidence interval = (1.4316, 1.5684)