1 USE THE ENCLOSED DATA TO SOLVE FOR THE FOLLOWING a Calcula

1. USE THE ENCLOSED DATA TO SOLVE FOR THE FOLLOWING:

a. Calculate the exact 95 percent upper lower confidence limits for each sample.

b. Use the =AND( ) statement, as given in Figure 7.3, to determine whether the confidence limits for each sample contain the true population mean.

c. Use =COUNTIF( ) to determine whether the proportion of samples of the one hundred actually contains the true mean of the population within the 95 percent limits.

d. Can you account for the result you got in (c)?

2. Calculate the approximate size required for each of the following at 95 percent confidence:

Standard deviation = 10, (ME) = 0.5, two tail

Standard deviation = 10, (ME) = 0.5, one tail

Standard deviation = 10, (ME) = 1.5, two tail

Standard deviation = 10, (ME) = 1.5, one tail

Standard deviation = 35, (ME) = 5, two tail

Standard deviation = 35, (ME) = 5, one tail

Standard deviation = $3,200, (ME) = 400, two tail

Standard deviation = $3,200, (ME) = 400, one tail

3. A hospital administrator wants to measure average cost per stay in his institution. He is willing to be within $200 of the true value with a probability of 95 percent. An initial investigation of a random sample of ten records determined that the standard deviation of cost was $3,987. How large a sample will need to be taken to meet the administrator’s needs?

Solution