John purchased a carr in 1961 for $12,000. Experts estimate that its value will increase by 5% per year. How much will be the co
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Answer:
And rounded up we have that n=656
Step-by-step explanation:
In order to find the critical value we need to take in count that we are finding the interval for a proportion, so on this case we need to use the z distribution. Since our interval is at 80% of confidence, our significance level would be given by and
. And the critical value would be given by:
Solution to the problem
The margin of error for the proportion interval is given by this formula:
(a)
Since we don't have prior info for the proportion of interest we can use as estimator. And on this case we have that
and we are interested in order to find the value of n, if we solve n from equation (a) we got:
(b)
And replacing into equation (b) the values from part a we got:
And rounded up we have that n=656