home ires to repair the smoke and fire damage that resuits rU Costs are rising f
ID: 3375220 • Letter: H
Question
home ires to repair the smoke and fire damage that resuits rU Costs are rising for all kinds of medical care. The mean monthly rent at assisted-living facilities was reported to have increased 17% over the last Wall Street Journal, October 27, 2012). Assume this cost estimate is based on a sample of 120 facilities and, from past studies, it can be assumed that the population standard . 10. five years to $ 3486 (The deviation is ?-$650. a. b. c. d. Develop a 90% confidence interval estimate of the population mean monthly rent. Develop a 95% confidence interval estimate of the population mean monthly rent. Develop a 99% confidence interval estimate of the population mean monthly rent. What happens to the width of the confidence interval as the confidence level is increased? Does this seem reasonable? Explain.Explanation / Answer
Ans:
a)90% confidence interval for true mean
=3486+/-1.645*(650/sqrt(120))
=3486+/-97.6
=(3388.4, 3583.6)
b)95% confidence interval for true mean
=3486+/-1.96*(650/sqrt(120))
=3486+/-116.3
=(3369.7, 3602.3)
c)99% confidence interval for true mean
=3486+/-2.58*(650/sqrt(120))
=3486+/-153.1
=(3332.9, 3639.1)
d)As,the level of confidence level increases, margin of error increases,hence CI width increases.
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