The regular price of a stainless steel iron is $30.00. Today it is on sale for 40% off. What is the sale price?
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Answer:
95.44% probability that the sample proportion will differ from the population proportion by less than 0.03.
Step-by-step explanation:
To solve this question, we need to understand the normal probability distribution and the central limit theorem.
Normal probability distribution
When the distribution is normal, we use the z-score formula.
In a set with mean and standard deviation
, the zscore of a measure X is given by:
The Z-score measures how many standard deviations the measure is from the mean. After finding the Z-score, we look at the z-score table and find the p-value associated with this z-score. This p-value is the probability that the value of the measure is smaller than X, that is, the percentile of X. Subtracting 1 by the pvalue, we get the probability that the value of the measure is greater than X.
Central Limit Theorem
The Central Limit Theorem estabilishes that, for a normally distributed random variable X, with mean and standard deviation
, the sampling distribution of the sample means with size n can be approximated to a normal distribution with mean
and standard deviation
.
For a skewed variable, the Central Limit Theorem can also be applied, as long as n is at least 30.
For a proportion p in a sample of size n, the sampling distribution of the sample proportion will be approximately normal with mean and standard deviation
In this question:
What is the probability that the sample proportion will differ from the population proportion by less than 0.03?
This is the pvalue of Z when X = 0.03 + 0.05 = 0.08 subtracted by the pvalue of Z when X = 0.05 - 0.03 = 0.02. So
X = 0.08
By the Central Limit Theorem
has a pvalue of 0.9772
X = 0.02
has a pvalue of 0.0228
0.9772 - 0.0228 = 0.9544
95.44% probability that the sample proportion will differ from the population proportion by less than 0.03.