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The recommended retail price of a brand of designer jeans is $150. A retail analyst sampled 16 retail stores and found the average price was $141 with a standard deviation of $4. If this is a ‘random’ sample and the prices can be assumed to be normally distributed, construct a 95% confidence interval for the average sale price.

Respuesta :

Answer:

Confidence Interval is 139.04 - 142.96

Explanation:

The formula for a confidence interval is as follow:

Mean (Average price) +/- z-score x standard deviation / sqrt(n)

Formula Interpretation:

Mean = $141

z-score for 95% confidence interval = 1.96

standard deviation = $4

n = 16 --> sqrt (n) = 4

By using these inputs, we can calculate the confidence interval as follow:

141 +/- 1.96 x (4/4)

Confidence Interval is 139.04 - 142.96

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