Outline the characteristics of a model which predicts its capital adequacy over a decade into the future of long term insurance?
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Answer:
The 95% confidence interval for the mean is between 0.985g/cm² and 1.047 g/cm².
Step-by-step explanation:
We have that to find our level, that is the subtraction of 1 by the confidence interval divided by 2. So:
Now, we have to find z in the Ztable as such z has a pvalue of .
So it is z with a pvalue of , so
Now, find M as such
In which is the standard deviation of the population and n is the size of the sample.
The lower end of the interval is the mean subtracted by M. So it is 1.016 - 0.0310 = 0.985 g/cm²
The upper end of the interval is the mean added to M. So it is 1.016 + 0.0310 = 1.047 g/cm²
The 95% confidence interval for the mean is between 0.985g/cm² and 1.047 g/cm².