Statistics Problem

Question

The finance VP of a company was interested in knowing how much money was set aside for health insurance by similar companies in this area of business. To estimate the unknown amount, a sample 36 similar companies was studied.

Results were x̅ = 29,300 and S = 2,160

Build to 95% confidence interval for the money set aside by the "similar" companies

If in total the number of similar companies is 200, adjust the 95% confidence interval as needed

Answer 1

confidence interval:

sample mean +/- critical t value * sample standard deviation/square root(sample size)

level of significance (alpha) = 1 - 0.95 = 0.05

critical t for n = 36 (35 DOF) and tail alpha/2 (0.025) = 2.03

plug sample mean, critical t value, sample standard deviation and sample size (n) into formula for CI.

If sample size (n) = 200, then critical t for n = 200 (199 DOF) and tail alpha/2 = 0.025 = 1.972.

plug sample mean, critical t value, sample standard deviation and sample size (n) into formula for CI.