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Viktor [21]
3 years ago
12

NASA is conducting an experiment to find out the fraction of people who black out at G forces greater than 6. In an earlier stud

y, the population proportion was estimated to be 0.4. How large a sample would be required in order to estimate the fraction of people who black out at 6 or more Gs at the 98% confidence level with an error of at most 0.04
Mathematics
1 answer:
zhuklara [117]3 years ago
3 0

Answer:

The sample size is = 814(approximately)

Step-by-step explanation:

Given -

Population proportion {\widehat{(p)} = 0.4

Confidence interval = 98\%

\alpha = 1 -  Confidence interval = 1 - .98

=  .02

\frac{\alpha}{2}  = .001

Margin\;  of\;  error = .04

Let sample size = n

Margin\;  of\;  error = z_{\frac{\alpha }{2}}\sqrt{\frac{{\widehat{(p)}}{(1 - \widehat{p})}}{n}}

.04 = z_{.01}\sqrt{\frac{(.4){(1 - (0.4)}}{n}}

For 98\% level of confidence, z = 2.33

.04 = 2.33\times\sqrt{\frac{(.4){(.6)}}{n}}

(Squaring both side)

(.04)^2 = (2.33)^2\times\frac{(.4)(.6)}{n}

n = \frac{(2.33)^2}{(.04)^2}\times{(.4)(.6)}

n = 814.33

Approximately n =814

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Explanation:

Since the <em>cash flow stream</em> is <em>uneven</em>, you must discount each stream individually and after you have discounted every stream you can add each preset value to find the net present value.

The formula for <em>present value</em> is:

               \text{Present Value} = \dfrac{\text{Future Value}}{(1+r)^n}\\\\\  Where:\\ \\ r = \text{Rate of return=interest rate}\\ \\ n = \text{Number of periods}

<u>1. Year 1:</u>

  • Future value = $250,000
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Present\text{ }value=\$250,000/(1+0.04)^1=\$240,384.62

<u>2. Year 2:</u>

  • Future value = $20,000
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Present\text{ }value=\$20,000/(1+0.04)^2=\$18,491.12

<u>3. Year 3:</u>

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<u>4. Year 4:</u>

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<u>5. Year 5:</u>

  • Future value = $550,000
  • r = 4%
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Present\text{ }value=\$550,000/(1+0.04)^5=\$452,059.91

<u>6. Year 6:</u>

  • Future value = $375,000
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Present\text{ }value=\$375,000/(1+0.04)^6=\$296,367.95

Total present value = $240,384.62 + $18,491.12 + $293,368.80 + $384,661.89 + $452,059.91 + $296,367.95 + $ 296,367.95

Total present value = $1,685,334.29 = $ 1,685,334

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