Question

In a survey, 29 people were asked how much they spent on their child's last birthday gift. The results were roughly bell-shaped with a mean of $31 and standard deviation of $14. Estimate how much a typical parent would spend on their child's birthday gift (use a 99% confidence level). Give your answers to one decimal place. Provide the point estimate and margin or error.

Answer 1

Given that,

point estimate = 31

s =14

n = 29

Degrees of freedom = df = n - 1 =29 - 1 = 28

At 99% confidence level the t is ,

= 1 - 99% = 1 - 0.99 = 0.01

/ 2 = 0.01 / 2 = 0.005

t /2  df = t0.005, = 2.763    ( using student t table)

Margin of error = E = t/2,df * (s /n)

= 2.763* ( 14/ 29) =7.2