Homework SourseA company wants to determine the sample size necessary to de
A company wants to determine the sample size necessary to determine its mean ordering lead time within 2 days at 99% confidence. If the variance of the lead times is 49, what size sample should it take?
A company wants to determine the sample size necessary to determine its mean ordering lead time within 2 days at 99% confidence. If the variance of the lead times is 49, what size sample should it take?
Solution
Confidence Interval CI = 99%
z value = 2.576 ( for 99% CI )
X = 2
Variance = 49 , therefore
Standard Deviation SD = sqrt (49) = 7
z = X / (SD/sqrt(n))
=> 2.576 = 2/(7/sqrt(n))
=> 2.576 = (2*sqrt(n) ) / 7
=> 2.576 * 7 = (2*sqrt(n) )
=> sqrt(n) = (2.576 * 7) / 2
=> sqrt(n) = 9.016
=> n = 81.3 ~ 81 Answer
