A random sample of 35 trading days is taken and the volume o

A random sample of 35 trading days is taken and the volume of a particular stock is recorded to determine whether the mean volume of the stock has changed from its 2007 value of 35.14 million shares. The sample resulted in a mean trading volume of = 39.48. Assuming a population standard deviation of 15.07, compute the margin of error for a 95% confidence interval for m.

Solution

sample size,n = 35
sample mean,xbar = 39.48
standard deviation,sigma = 15.07
alpha,a = 1-0.95 = 0.05

H0: u = 35.14
H1: u is not equal to 35.14

Za/2 = Z0.025 = 1.96

margin of error:
= Za/2 * (sigma/sqrt(n))
= 1.96 * (15.07/sqrt(35))
= 4.9927