11 when using a 95 percent confidence interval for a

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11. When using a 95 percent confidence interval for a mean, the area in the upper tail of the distribution that is outside the interval is 5 percent. 12. In developing a confidence interval estimate, the margin of error is directly dependent on the value of the point estimate.
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QMS230-Statistics for Accounting & Finance Chapter10 Winter2015 Page# 24 13 The margin of error is one-half the width of the confidence interval. 14. When σ is unknown, the margin of error is computed by using t distribution. 15. Two confidence interval estimates were developed from the same sample of a population. The wider interval will be the one that has the highest confidence level. 16. One way to reduce the margin of error in a confidence interval estimate is to lower the level of confidence. 17. When estimating sample size, a 90 percent confidence level will result in a smaller sample size than a 95 percent confidence level. 18. In a recent report to the supply chain manager in a major electronics company, the report writer stated that with 90 percent confidence, the manufacturing lead time for a critical part is between 3.34 hours and 4.14 hours. Based on this information, the margin of error for this estimate is ± .80 hours. 19. In a situation where we know the sample standard deviation but wish to estimate the population mean using a 97 percent confidence interval, the critical values are ±2.170. PART B: Short Answer Question 1. In an application to estimate the mean number of miles that downtown employees commute to work roundtrip each day, the following information is given: n = 20 x = 4.33 s = 3.50 a . The point estimate for the true population mean is: b . Determine the critical value(s) for a 98% confidence interval for the population mean number of miles that downtown employees commute to work roundtrip each day. c . Construct a 98% confidence interval for the population mean number of miles that downtown employees commute to work roundtrip each day Question 2.
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QMS230-Statistics for Accounting & Finance Chapter10 Winter2015 Page# 25 Ryerson Software Inc. recently developed a new statistical software and wanted to estimate the mean time taken to learn how to use this software by people who are somewhat familiar with computer and statistics. A random sample of 12 such people was selected. The following data show the times taken (in hours) by these people to learn how to use this statistical software. 3.25 2.85 3.40 2.90 2.50 3.75 3.15 3.27 2.90 3.20 4.25 3.60 Assume that the times taken by all persons who are somewhat familiar with computer and statistics to learn how to use this software are approximately normally distributed. a . What is the point estimate of the population mean time taken to learn how to use this software? b . Determine the critical value(s) for a 98% confidence interval for the population mean time taken to learn how to use this software. Interpret the result.
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