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Example 1 A software development company wanted to estimate the population mean of monthly expenditures for their 250 software developers. Forty developers were randomly selected. Their mean monthly expenditures were RM5,000 with a population standard deviation of RM500. a. What is the population mean? b. Construct a 95% confidence interval for the population mean and interpret the result. c. Construct a 99% confidence interval for the population mean and interpret the result. d. Is it reasonable to conclude that the population mean will be RM5,200 at the 99% confidence level? e. Compare the results of (b) and (c). f. Is there any benefit of using a higher confidence level?

Example 1   A software development company wanted to estimate the population mean of monthly expenditures for their 250 software developers. Forty developers were randomly… Read More »Example 1 A software development company wanted to estimate the population mean of monthly expenditures for their 250 software developers. Forty developers were randomly selected. Their mean monthly expenditures were RM5,000 with a population standard deviation of RM500. a. What is the population mean? b. Construct a 95% confidence interval for the population mean and interpret the result. c. Construct a 99% confidence interval for the population mean and interpret the result. d. Is it reasonable to conclude that the population mean will be RM5,200 at the 99% confidence level? e. Compare the results of (b) and (c). f. Is there any benefit of using a higher confidence level?