Warren County Telephone Company claims in its annual report that “the typical cu
ID: 3151424 • Letter: W
Question
Warren County Telephone Company claims in its annual report that “the typical customer spends $61 per month on local and long-distance service.” A sample of 12 subscribers revealed the following amounts spent last month. $63 $63 $63 $69 $60 $64 $68 $64 $65 $53 $53 $68 a. What is the point estimate of the population mean? (Round your answer to 3 decimal places.) Estimated population mean $ b. Develop a 95% confidence interval for the population mean. (Use t Distribution Table.) (Round your answers to 3 decimal places.) Confidence interval for the population mean $ and $ c. Is the company's claim that the "typical customer" spends $61 per month reasonable? Yes No rev: 11_20_2014_QC_58943, 09_07_2015_QC_CS-23881, 12_07_2015_QC_CS-34789 ReferenceseBook & Resources
Explanation / Answer
a)
The point estimate is the sample mean,
X = sample mean = 62.75 [ANSWER]
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b)
Note that
Lower Bound = X - t(alpha/2) * s / sqrt(n)
Upper Bound = X + t(alpha/2) * s / sqrt(n)
where
alpha/2 = (1 - confidence level)/2 = 0.025
X = sample mean = 62.75
t(alpha/2) = critical t for the confidence interval = 2.20098516
s = sample standard deviation = 5.224505196
n = sample size = 12
df = n - 1 = 11
Thus,
Lower bound = 59.43050777
Upper bound = 66.06949223
Thus, the confidence interval is
( 59.43050777 , 66.06949223 ) [ANSWER]
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c)
YES, BECAUSE $61 IS INSIDE THE INTERVAL.
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