A second sample is to be drawn with the goal of producing a

A second sample is to be drawn with the goal of producing a new 99% confidence interval for the proportion with a margin of error, E, no greater than 5%. What is the minimum sample size, n, required to achieve this goal?

8.110 An insurance company selected a sample of 50 auto claims filed with it and investigated those claims carefully. The company found that 12% of those claims were fraudulent.

Solution

Compute Sample Size ( n ) = n=(Z/E)^2*p*(1-p)
Z a/2 at 0.01 is = 2.576
Samle Proportion = 0.12
ME = 0.05
n = ( 2.576 / 0.05 )^2 * 0.12*0.88
= 280.295 ~ 281