Question

Four cars are for sale. The red car costs $15,000, the blue car costs $18,000, the green car costs $22,000, and the white car costs $20,000. Use the table to identify all possible samples of size n = 2 from this population and their sample minimums. The first sample is done for you.

Sample
n = 2 R, B R, G R, W B, G B, W G, W
Costs
($1000s) 15, 18 15, 22 15, 20 18, 22 18, 20 22, 20
Sample
Mean 15 15 15 18 18 20

What is the mean of all six sample minimums?

What is the value of the population minimum?

Is the sample minimum an unbiased estimator of the population minimum?

Answer 1

Step-by-step explanation:The six sample minimums are 15, 15, 15, 18, 18, and 20.

To find the mean of all six sample minimums, we add them up and divide by 6:

(15 + 15 + 15 + 18 + 18 + 20) / 6 = 16.1667

So the mean of all six sample minimums is $16,166.67.

The population minimum is the smallest cost among the four cars, which is $15,000.

The sample minimum is a biased estimator of the population minimum. Since the samples are of size 2, the probability of obtaining the population minimum as the sample minimum is only 1/3 (when the minimum of the two cars selected is the population minimum). Therefore, the sample minimum tends to underestimate the population minimum.