Question

Many states are carefully considering steps that would help them collect sales taxes on items purchased through the Internet. How many randomly selected sales transactions must be surveyed to determine the percentage that transpired over the Internet? Assume that we want to be 99% confident that the sample percentage is within three percentage points of the true population percentage for all sales transactions. n= (Round up to the nearest integer.)

Answer 1

7,396.

Step-by-step explanation:

Given that we want to find how many randomly selected sales transactions must be surveyed to determine the percentage that transpired over the Internet.

Given;

Confidence interval = 99%

Z value = 2.58

Margin of error ME=3% =0.03

Applying the formula;

`n=(z^2)/(ME^2)`

Substituting the values;

`\begin{gathered} n=(2.58^2)/(0.03^2) \\ n=(6.6564)/(0.0009) \\ n=7,396 \end{gathered}`

Therefore, the number of randomly selected sales transactions that must be surveyed to determine the percentage that transpired over the Internet is 7,396.