Question

A survey of 25 grocery stores revealed that the mean price of a gallon of milk was $2.98, with a standard error of $0.10. What is the 95% confidence interval to estimate the true cost of a gallon of milk?

Answer 1

95% confidence interval: (2.784,3.176)

Explanation:

We are given the following information in the question:

Sample size, n = 25

Sample mean = $2.98

Standard error = $0.10

Alpha = 0.05

95% confidence interval:

`\mu \pm z_(critical)(\text{Standard error})`

Putting the values, we get,

`z_(critical)\text{ at}~\alpha_(0.05) = 1.96`

`2.98 \pm 1.96(0.10) = 2.98 \pm 0.196 = (2.784,3.176)`