Question

(CO 4) Supplier claims that they are 95% confident that their products will be in the interval of 20.45 to 21.05. You take samples and find that the 95% confidence interval of what they are sending is 20.48 to 21.02. What conclusion can be made

Answer 1

The supplier is less accurate than they have claimed

Explanation:

Given that:

95% confidence interval of supplier's claim :

(20.45, 21.05)

Mean = (20.45 + 21.05) /2 = 41.5 / 2 = 20.75

Error margin = (upper bound - mean) = 21.05 - 20.75 = 0.30

95% confidence interval of your sample :

(20.48, 21.02)

Mean : (20.48 + 21.02) /2 = 41.05 / 2 = 20.75

Error margin = (upper bound - mean) = 21.02 - 20.75 = 0.27

0.3 > 0.27

From the calculations made, the mean are the same, but the error margin of supplier is higher, thus it could be concluded that the supplier is less accurate than they have claimed