Question

The mean monthly car payment for 123 residents of the local apartment complex is $624. What is the best point estimate for the mean monthly car payment for all residents of the local apartment complex?

Answer 1

The best point estimate for the mean monthly car payment for all residents of the local apartment complex is $624.

Explanation:

The Central Limit Theorem estabilishes that, for a normally distributed random variable X, with mean
`\mu` and standard deviation
`\sigma`, the sampling distribution of the sample means with size n can be approximated to a normal distribution with mean
`\mu` and standard deviation
`s = (\sigma)/(√(n))`.

In this question:

We apply the inverse Central Limit Theorem.

The mean monthy car payment for 123 residents of the local apartment complex is $624.

So, for all residents of the local apartment complex, the best point estimate for the mean monthly car payment is $624.