7. Sampling Distributions & Confidence Intervals: Mean

Gas prices are getting more and more expensive. The average gas price, from a random sample of 100 gas stations, was \$3.50. It is assumed that gas prices have a standard deviation of \$0.04. Construct an 80% confidence interval for the true mean gas price in the United States.

Books get more and more expensive every semester, but the distribution of their prices is always normal. 25 randomly selected students in your school spent, on average \$500 with a standard deviation of \$50. Construct a 98% confidence interval for the true spending on books.

You want to purchase one of the new Altima. You randomly select 400 dealerships across the United States and find a mean of \$25,000. Assume a population standard deviation of \$2500. Construct and interpret a 94% confidence interval for the true mean price for the new Nissan Altima.

Find the critical value $t_{\frac{\alpha }{2}}$for an 80% confidence interval given a sample size of 51.

Ages of Prisoners The accompanying frequency distribution summarizes sample data consisting of ages of randomly selected inmates in federal prisons (based on data from the Federal Bureau of Prisons). Use the data to construct a 95% confidence interval estimate of the mean age of all inmates in federal prisons.

Finite Population Correction Factor If a simple random sample of size n is selected without replacement from a finite population of size (n>0.05N), and the sample size is more than 5% of the population size , better results can be obtained by using the finite population correction factor, which involves multiplying the margin of error E by [Image]. Refer to the weights of the M&M candies in Data Set 38 “Candies” in Appendix B.

b. Use only the red M&Ms and treat that sample as a simple random sample selected from the population of the 345 M&Ms listed in the data set. Find the 95% confidence interval estimate of the mean weight of all 345 M&Ms. Compare the result to the actual mean of the population of all 345 M&Ms.

Mean Assume that we want to use the sample data given in Exercise 1 with the bootstrap method to estimate the population mean. The mean of the values in Exercise 1 is 54.3 seconds, and the mean of all of the tobacco times in Data Set 20 “Alcohol and Tobacco in Movies” from Appendix B is 57.4 seconds. If we use 1000 bootstrap samples and find the corresponding 1000 means, do we expect that those 1000 means will target 54.3 seconds or 57.4 seconds? What does that result suggest about the bootstrap method in this case?

In Exercises 5–8, (a) identify the critical value ta/2 used for finding the margin of error, (b) find the margin of error, (c) find the confidence interval estimate of u, and (d) write a brief statement that interprets the confidence interval.

Pepsi Weights Here are summary statistics for the weights of Pepsi in randomly selected cans: n=36, x=0.82410 lb, s=0.00570 lb (based on Data Set 37 “Cola Weights and Volumes” in Appendix B). Use a confidence level of 99%.