Exercises 5.

– Solutions - Confidence Intervals

1. The temperature readings for 20 winter days in Grand Rapids, Michigan are normally
distributed with mean 5.5 degrees and a standard deviation of 1.5. Determine the 90%
confidence interval estimate for the winter mean temperature.

Answer

x = 5.5
SD = s = 1.5
n = 20
 = 0.1

Use the t distribution as the standard deviation of the population is unknown and the sample size
is small, less than 30.
s
The margin of error E = t
n2

t = t 5% = 1.729 since we have 19 degrees of freedom (20-1).

2

90% Confidence Interval

90%

5% 5%
–1.729 0 1.729
90%
s 1.5
The E = t = (1.729) = 0.5799
2 n 20

The lower limit of the interval is x − E = 5.5 − 0.5799 = 4.9200

The upper limit of the interval is x + E = 5.5 + 0.5799 = 6.0799

The 90% confidence interval estimate for the winter mean temperature is
(4.9200,6.0799).

1
2. A sample of 49 measurements of tensile strength (roof hanger) are calculated to have a
mean of 2.45 and a standard deviation of 0.25. Determine the 95% confidence interval for
the measurements of all hangers.

Answer

x = 2.45
SD = s = 0.25
n = 49
 = 0.05

s
The margin of error E = z
2 n
z = z 2.5% = 1.96 since
2

95% Confidence Interval

95%

2.5% 2.5%
–1.96 0 1.96
95%

s 0.25
The E = z = (1.96) = 0.07
2 n 49

The lower limit of the interval is x − E = 2.45 − 0.07 = 2.38

The upper limit of the interval is x + E = 2.45 + 0.07 = 2.52

The 95% confidence interval for the measurements of all hangers is

(2.38, 2.52).

2
3. If we repeatedly draw samples of size 100 from the population of teenagers, 95% of
the values of sample means will be such that the population mean amount of time
teenagers spend on the internet would be somewhere between 6.206 hours and 6.794, and
5% of the values of the sample mean will produce intervals that would not include the
population mean.

a. Determine the 99% confidence interval estimate of the population mean.

b. Determine the 90% confidence interval estimate of the population mean.
c. Determine the 95% confidence interval estimate of the population mean if the
sample size is changed to 300.

95% Confidence Interval

95%

2.5% 2.5%
6.206  6.794
95%
Now z = z 2.5% = 1.96 since
2
We know it is z ( and not t) as the sample size is large (100).

95% Confidence Interval

95%

2.5% 2.5%
–1.96 0 1.96
95%

6.794 = x + 1.96
100

6.206 = x − 1.96 Adding these equations together gives:
100
13.00 = 2 x So therefore x = 6.5
Since x = 6.5 then substituting this value into say the very first equation above gives:
 (6.794 − 6.5) 100
6.794 = 6.5 + 1.96 Solving gives: =
100 1.96
So then  = 1.5

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 a. Determine the 99% confidence interval estimate of the population mean.

x = 6.5
SD =  = 1.5
n = 100
 = 0.01


The margin of error E = z
2 n
z = z 0.5% = 2.575 since
2

99% Confidence Interval

99%

0.5% 0.5%

–2.575 0 2.575
99%

 1.5
The E = z = (2.575) = 0.38625
2 n 100

The lower limit of the interval is x − E = 6.5 − 0.38625 = 6.11375

The upper limit of the interval is x + E = 6.5 + 0.38625 = 6.88625

The 99% confidence interval estimate of the population mean is

(6.11375, 6.88625).

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 b. Determine the 90% confidence interval estimate of the population mean.

x = 6.5
SD =  = 1.5
n = 100
 = 0.1


The margin of error E = z
2 n
z = z 5% = 1.645 since
2

90% Confidence Interval

90%

5% 5%
–1.645 0 1.645
90%

 1.5
The E = z = (1.645) = 0.24675
2 n 100

The lower limit of the interval is x − E = 6.5 − 0.24675 = 6.2532

The upper limit of the interval is x + E = 6.5 + 0.24675 = 6.74675

The 90% confidence interval estimate of the population mean is

(6.2532, 6.74675).

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 c. Determine the 95% confidence interval estimate of the population mean if the
sample size is changed to 300.

x = 6.5
SD =  = 1.5
n = 300
 = 0.05


The margin of error E = z
2 n
z = z 2.5% = 1.96 since
2

95% Confidence Interval

95%

2.5% 2.5%
–1.96 0 1.96
95%

 1.5
The E = z = (1.96) = 0.1697409
2 n 300

The lower limit of the interval is x − E = 6.5 − 0.1697 = 6.3303

The upper limit of the interval is x + E = 6.5 + 0.1697 = 6.6697

The 95% confidence interval estimate of the population mean is

(6.3303,6.6697).

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4. A quality control engineer is interested in the mean length of sheet insulation being cut
automatically by machine. The desired length of the insulation is 12 feet. It is known that
the standard deviation in the cutting length is 0.15 feet. A sample of 60 cut sheets yields a
mean length of 12.15 feet. This sample will be used to obtain a 99% confidence interval
for the mean length cut by machine.

a. What is the critical value to use in obtaining the confidence interval?

b. Develop the 99% confidence interval for .

x = 12.15
SD =  = 0.15
n = 60
 = 0.01


The margin of error E = z
2n
a. z = z 0.5% = 2.575 since
2

99% Confidence Interval

99%

0.5% 0.5%

–2.575 0 2.575
99%

b. Develop the 99% confidence interval for .

 0.15
The E = z = (2.575) = 0.0498646
2 n 60

The lower limit of the interval is x − E = 12.15 − 0.04986 = 12.10

The upper limit of the interval is x + E = 12.15 + 0.04986 = 12.20

The 99% confidence interval estimate of the population mean is

(12.10, 12.20).

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5. Find the sample size needed to estimate a population mean to within 2 units of the
sample mean, with a 95% confidence level when the population standard deviation equals
8.

Answer

E = 2 - Sampling error.
SD =  = 8
 = 0.05
z = z 2.5% = 1.96 since
2

95% Confidence Interval

95%

2.5% 2.5%
–1.96 0 1.96
95%


The margin of error E = z
n2

Substitute into this equation and solve for n.

 8 8
E = z then 2 = 1.96 So n = ((1.96) ) 2 = 61.47
2n n 2
Round to nearest whole number.

The sample size needed to estimate a population mean is 62.

8
6. To estimate with 99% confidence the mean of a normal population, whose standard
deviation is assumed to be 6 and the maximum allowable sampling error is assumed to be
1.2, requires a random sample of what size?

Answer

E = 1.2 - Sampling error.

SD =  = 6
 = 0.01
z = z 0.5% = 2.575 since
2

99% Confidence Interval

99%

0.5% 0.5%

–2.575 0 2.575
99%


The margin of error E = z
2 n
Substitute into this equation and solve for n.

 6 6 2
E = z then 1.2 = 2.575 So n = ((2.575) ) = 165.77
2n n 1.2
Round to nearest whole number.

The sample size needed to estimate a population mean is 166.

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7. The sample size needed to estimate a population mean to within 50 units of the sample
mean was found to be 97. The population standard deviation was 250, then what
confidence level was used?

Answer

E = 50 - Sampling error.
SD =  = 250
n = 97

The margin of error E = z
n 2

Substitute into this equation and solve for z .

2

 250 (50) 97
E = z then 50 = z So = z
2 n 2 97 250 2

z = 1.96977
2

95% Confidence Interval

95%

2.5% 2.5%
–1.96 0 1.96
95%

The confidence level used was 95%.

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8. A statistician wants to estimate the mean weekly family expenditure on clothes. She
believes that the standard deviation of the weekly expenditure is $125. Determine with
99% confidence the number of families that must be sampled to estimate the mean
weekly family expenditure on clothes to within $15.

Answer

E = 15 - Sampling error.
SD =  = 125
 = 0.01
z = z 0.5% = 2.575 since
2

99% Confidence Interval

99%

0.5% 0.5%

–2.575 0 2.575
99%


The margin of error E = z
2 n
Substitute into this equation and solve for n.

 125 125 2
E = z then 15 = 2.575 So n = ((2.575) ) = 460.46
2n n 15
Round to nearest whole number.

The number of families that must be sampled to estimate the mean weekly family
expenditure on clothes to within $15 is 461.

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9. How large a sample of state employees should be taken if we want to estimate with
98% confidence the mean salary to within $2000? The population standard deviation is
assumed to be $10,500.

Answer

E = 2,000 - Sampling error.

SD =  = 10,500
 = 0.02
z = z1% = 2.33 since
2

98% Confidence Interval

98%

1% 1%

–2.33 0 2.33
98%


The margin of error E = z
2 n
Substitute into this equation and solve for n.

 10,500 10,500 2
E = z then 2,000 = 2.33 So n = ((2.33) ) = 149.63
2n n 2,000
Round to nearest whole number.

The sample size needed to estimate a population mean is 150.

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10. The owner of Britten’s egg farm wants to estimate the mean number of eggs laid per
chicken. A sample of 20 chickens shows they laid an average of 20 eggs per month with a
standard deviation of 2 eggs per month.

a) What is the value of the population mean? What is the best estimate of this value?
b) What assumption do we need to make?
c) For the 95% confidence level what is the value of the critical point?
d) Develop the 95% confidence interval for the population mean.
e) Would it be reasonable to conclude that the population mean is 21 eggs?
f) Would it be reasonable to conclude that the population mean is 25 eggs?

Answers

a) What is the value of the population mean? What is the best estimate of this value?

The population mean is unknown, but the best estimate is 20, the sample mean.

b) What assumption do we need to make?

. Use the t distribution as the population standard deviation is unknown and the
sample size is small. However, assume the population is normally distributed.

c) For the 95% confidence level what is the value of the critical point?

We have 19 (20-1) degrees of freedom. Using the t-tables

t = t 2.5% = 2.093 since

2

95% Confidence Interval

95%

2.5% 2.5%
–2.093 0 2.093
95%

2.093

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d) Develop the 95% confidence interval for the population mean.

x = 20
SD = s = 2
n = 20
 = 0.05 and t = t 2.5% = 2.093
2

s
The margin of error E = t
2 n

s 2
So E = t = (2.093) = 0.9360
2 n 20

The lower limit of the interval is x − E = 20 − 0.9360 = 19.06

The upper limit of the interval is x + E = 20 + 0.9360 = 20.94

The 95% confidence interval estimate of the population mean is

(19.06,20.94).

e) Would it be reasonable to conclude that the population mean is 21 eggs?

f) Would it be reasonable to conclude that the population mean is 25 eggs?

Neither value is reasonable because they are not inside the interval.

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11. The American Sugar Producers Association wants to estimate the mean yearly sugar
consumption. A sample of 16 people reveals the mean yearly consumption to be 60
pounds with a standard deviation of 20 pounds.

a) What is the value of the population mean?

b) What distribution do we use?
c) Find the critical point for the 90% confidence level.
d) Develop the 90% confidence interval for the population mean.
e) Would it be reasonable to conclude that the population mean is 63 pounds?

Answer

a) What is the value of the population mean?

The population mean is unknown, but the best estimate is 60, the sample mean.

b) What distribution do we use?

Use the t distribution as the population standard deviation is unknown and the sample
size is small. However, assume the population is normally distributed.

c) Find the critical point for the 90% confidence level.

We have 15 (16-1) degrees of freedom. Using the t-tables

t = t 5% = 1.753 since
2

90% Confidence Interval

90%

5% 5%
–1.753 0 1.753
90%

1.753

15
d) Develop the 90% confidence interval for the population mean.

x = 60
SD = s = 20
n = 16
 = 0.05 and t = t 5% = 1.753
2

s
The margin of error E = t
2 n

s 20
So E = t = (1.753) = 8.765
2 n 16

The lower limit of the interval is x − E = 60 − 8.765 = 51.235

The upper limit of the interval is x + E = 60 + 8.765 = 68.765

The 90% confidence interval estimate of the population mean is

(51.235,68.765).

e) Would it be reasonable to conclude that the population mean is 63 pounds?

That value is reasonable because it is inside the interval.

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12) The union representing the Institute of Actuaries (IOA) is considering a proposal to
merge with the Faculty of Actuaries (FOA). According to the IOA union bylaws, at least
three-fourths of the union membership must approve any merger. A random sample of
2,000 current IOA members reveals 1,600 plan to vote for the merger proposal.

a) Develop a 95% confidence interval for the population proportion

b) Basing your decision on this sample information, can you conclude that the
necessary proportion of IOA members favor the merger?

c) Explain your answer to part b).

Solution

a) Develop a 95% confidence interval for the population proportion

Lower Confidence Interval

=0.80-1.96*0.0175=0.7825

Upper Confidence Interval

=0.80+1.96*0.0175=0.8175

b) Basing your decision on this sample information, can you conclude that the
necessary proportion of IOA members favor the merger?

Yes.

c) Explain answer to part b)?

The lower endpoint of the interval is greater than 75% - the three fourths union
membership required for approval.

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13. The owner of the Quick Fill Gas Station wished to determine the proportion of
customers who use a credit or debit card for their fuel purchase. A sample of 100
customers were surveyed and it was found that 80 paid at the pump.

a. Estimate the value of the population proportion

b. Calculate the standard error of the proportion
c. Develop a 95% confidence interval for the population proportion
d. Interpret your findings

a. Estimate the value of the population proportion

b. Calculate the standard error of the proportion

c. Develop a 95% confidence interval for the population proportion

Lower Confidence Interval

=0.8-1.96*0.04=0.7216

Upper Confidence Interval

=0.8+1.96*0.04=0.8784

d. Interpret your findings

Between 72.16% and 87.84% of customers use a credit or debit card as the payment
method for their fuel purchase – using a 95% confidence level.

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14. Foxy TV network is looking in to replacing its prime time CSI show with a family
oriented comedy show. Before a decision is made, a sample of 400 viewers are asked for
their opinions. After viewing the pilot for the comedy, 250 indicated that they would
watch the show and suggested it should replace the CSI show.

a. Estimate the value of the population proportion

b. Calculate the standard error of the proportion
c. Develop a 99% confidence interval for the population proportion
d. Interpret your findings

a. Estimate the value of the population proportion

b. Calculate the standard error of the proportion

c. Develop a 95% confidence interval for the population proportion

Lower Confidence Interval

=0.625-2.575*0.0242=0.5627

Upper Confidence Interval

=0.625+12.575*0.0242=0.6873

d. Interpret your findings

Between 56.27% and 68.73% of customers prefer replacing the CSI show with the family
comedy – using a 99% confidence level.

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15. Silkscreen Printing Inc., purchases coffee mugs on which to print funny logos. A
large shipment was received and the owner wants to ensure that the quality is good and
that they are not defective. A sample of 300 cups was chosen at random and it was found
that 15 were defective.

a. Estimate the value of the population proportion

b. Develop a 95% confidence interval for the proportion defective
c. The owner of Silkscreen Printing Inc., has an agreement with the supplier, that if
10% or more of the shipment is defective, he may return it. Should he return this
shipment.

a. Estimate the value of the population proportion

b. Develop a 95% confidence interval for the population proportion

Lower Confidence Interval

=0.05-1.96*0.0126=0.0253

Upper Confidence Interval

=0.05+1.96*0.0126=0.0747

c. The owner of Silkscreen Printing Inc., has an agreement with the supplier, that if
10% or more of the shipment is defective, he may return it. Should he return this
shipment.
d.

Between 2.53% and 7.47% of merchandise is defective in a shipment – using a 95%

confidence level. Since this is less than 10%, the shipment will not be returned.

20