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Lady bird [3.3K]
3 years ago
9

the Wall Street Journal reported that automobile crashes cost United States $162 billion annually. The average cost per person f

or crashes in the Tampa, Florida area was reported to be $1599. Suppose the average cost was based on a sample of 50 persons who had been involved in crashes and that the population standard deviation is $600.a.) What is the margin of error for a 95% confidence interval?b.) what would you recommend if the study required a margin of error of $150 or less?
Mathematics
1 answer:
Tanya [424]3 years ago
6 0

Answer:

a) Margin of error = 166.311

b) sample size ≥ 62

Step-by-step explanation:

Given:

Average cost = $1599

Sample size = 50 persons

Standard deviation = $600

Confidence level is 95%

a) Margin of error = z\frac{\sigma}{\sqrt{n}}

Now for confidence level of 95% z-value = 1.96

Thus,

Margin of error = 1.96\frac{600}{\sqrt{50}}

or

Margin of error = 166.311

b) For Margin of error ≤ 150

z\frac{\sigma}{\sqrt{n}} ≤ 150

or

1.96\frac{600}{\sqrt{n}} ≤ 150

or

1.96\frac{600}{150} ≤ √n

or

√n ≥ 7.84

or

n ≥ 61.4656

Therefore,

sample size ≥ 62

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