BA 303 - BUSINESS STATISTICS - Week 4: Learning Unit 2: Homework: Chapter 6, Problem

Chapter 6, Problem 20.

For the data in the Excel file Debt and Retirement Savings, find 95% confidence intervals for the mean income, long-term debt, and retirement savings. Use the appropriate formulas and Excel functions.

The mean () is the average of all values in a particular category. In excel it is calculated by the =average() function.

The standard deviation () is calculated as where is the value of observation, and is the number of observations.

In excel it is calculated by the =stdev() function.

Z value for 95% confidence interval is found from standard Z table and its value is 1.96

Finally, we compute mean for 95% confidence interval =

The completed table is shown below:

Brenau University - BA 303 - BUSINESS STATISTICS - Week 4 Learning Unit 2 Homework Chapter

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We are 95% confident that the income for both graduate and undergraduate people either married or single is between $77,695.83 to $158317.14. On the other hand, the average long-term debt , having a confidence of 95% is estimated to be between $22095.83 and $79781.52. Finally, with a confidence of 95% on retirement savings is between $36104.17 and $108,598.58.