(6 marks) The mean preparation fee H&R; Block charged retail customers last year

Question

(6 marks) The mean preparation fee H&R; Block charged retail customers last year was $183 (The Wall Street Journal, March 7, 2012). Use this price as the population mean and assume the population standard deviation of preparation fees is $50 a) What is the probability that the mean price for a sample of 30 H&R; Block retail customers is 4. within $8 of the population mean? What is the probability that the mean price for a sample of 50 H&R; Block retail customers is within $8 of the population mean? What is the probability that the mean price for a sample of 100 H&R; Block retail customers is within S8 of the population mean? Which, if any, of the sample sizes in parts (a), (b), and (c) would you recommend to have at least a 0.95 probability that the sample mean is within $8 of the population mean? b) c) d)

Explanation / Answer

Mean = 183

SD = 50

a) z1 = - 8/50/30

z1 = - 0.876

z2 = 0.876

P = 0.6157

b)

z1 = - 8/50/50

z1 = - 1.13

z2 = 1.13

P = 0.7415

c)

z1 = - 8/50/100

z1 = - 1.6

z2 = 1.6

P = 0.8904

d) We would not use any samples from above. We should increase the sample size in order to be 95% sure.

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