An Internet based e-learning company has begun using new online statistics conte

Question

An Internet based e-learning company has begun using new online statistics content to replace a textbook. Since the main competition is hardback textbooks, before the company decides what price to charge students for the new product, it wants to know the average price of all hardback statistics textbooks currently on the market. The research department at the company took a random sample of 30 such textbooks and collected information on their prices. This information produced a mean price of $94.50 for this sample. It is known that the standard deviation of the prices of all such textbooks is $4.50. The 90% confidence interval for the mean price of all such college textbooks was found to be (93.15, 95.85). Choose the best interpretation of this confidence interval.

Explanation / Answer

The best interpretation of the confidence interval is,
"If repeated samples of college textbooks were taken with same sample size, 90% of the confidence intervals will contain the true mean of the college textbooks."

Another way to interpret is,
"Based on the sample provided, we are 95% confident the true mean of college textbooks is within the interval 93.15 and 95.85"

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