Question

A random sample of 10 houses in a particular area, each of which is heated with natural gas, is selected and the amount of gas (therms) used during the month of January is determined for each house. The resulting observations are 118, 125, 143, 138, 141, 122, 109, 103, 99, 90. Let μ denote the average gas usage during January by all houses in this area. Compute a point estimate of μ.

Answer 1

μ = 118.8

Explanation:

Based on the data, the total number of observation is n = 10

It is known that the sample mean is the unbiased estimator of the population mean. Thus, it is suitable to use sample mean as x = μ, as the estimator of population mean,

Sample Mean x = ∑ i from 1 to n x_i/n

x = 1188/10

x = μ = 118.8