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3-7. The following sample data have been collected based on a simple random sample from a normally distributed population: 2 5 8 3 I 2 4 3 2 a. Compute a 90% confidence interval estimate for the population mean. b. Show what the impact would be if the confidence level is increased to 95%. Discuss why this occurs.​

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Final answer:

a) The 90% confidence interval estimate for the population mean is (2.680, 3.986).

b) Increasing the confidence level to 95% widens the confidence interval, capturing a larger range of possible population means.

Step-by-step explanation:

a) To compute a 90% confidence interval estimate for the population mean, we can use the formula:

CI = sample mean ± (critical value) x (standard error)

First, calculate the sample mean:

Sample mean = (2+5+8+3+1+2+4+3+2)/9

= 3.333

Next, calculate the standard deviation of the sample:

Standard deviation = sqrt((sum of (xi - sample mean) squared)/n-1)

Standard deviation = sqrt((9.333)/8)

≈ 1.15

Then, calculate the standard error:

Standard error = standard deviation/sqrt(n)

Standard error = 1.15/sqrt(9)

= 0.383

Next, find the critical value for a 90% confidence interval using a standard normal distribution table or calculator.

For a 90% confidence interval, the critical value is approximately 1.645.

Lastly, calculate the confidence interval:

CI = 3.333 ± (1.645)(0.383)

= (2.680, 3.986)

Therefore, the 90% confidence interval estimate for the population mean is (2.680, 3.986).

If the confidence level is increased to 95%, we need to find the new critical value.

For a 95% confidence interval, the critical value is approximately 1.96. Using this new critical value:

CI = 3.333 ± (1.96)(0.383) = (2.586, 4.080)

b) The impact of increasing the confidence level to 95% is that the confidence interval becomes wider, meaning it captures a larger range of possible population means.

This occurs because a higher confidence level requires more certainty and therefore a larger range of values to be included in the interval.

Increasing the confidence level to 95% ensures a higher level of confidence that the interval contains the true value of the population mean, but at the cost of a wider interval.

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