A financial services company wants to estimate the amount of credit card debt that students typically have when they graduate from college by generating a 90% confidence interval for the mean credit card debt of all students. Assume that, based on data from a previous study conducted two years ago, the standard deviation of student credit card debt is approximately $810. a) The company is considering using a sample size of 50 students to develop its estimate. What would be the (approximate) margin of error be for the 90% confidence interval based on a random sample of 50 students? b) The company would like a margin of error of no more than $125 for its estimate. How large a sample size is needed to generate a 90% confidence interval with a margin of error of $125? c) Based on the study’s budget, the company decides to select a random sample of 100 recent college graduates and asks each of them to indicate the amount of credit card debt they had at the time of graduation. The average credit card debt per student in the sample was $2,430, with a standard deviation of $770. Using this data, calculate a 90% confidence interval for the mean credit card debt of recent college graduates. Conduct a complete analysis and interpret your interval estimate in context of the study.
A financial services company wants to estimate the amount of credit card debt that students typically have when they graduate from college by generating a 90% confidence interval for the
a) The company is considering using a
b) The company would like a margin of error of no more than $125 for its estimate. How large a sample size is needed to generate a 90% confidence interval with a margin of error of $125?
c) Based on the study’s budget, the company decides to select a random sample of 100 recent college graduates and asks each of them to indicate the amount of credit card debt they had at the time of graduation. The average credit card debt per student in the sample was $2,430, with a standard deviation of $770. Using this data, calculate a 90% confidence interval for the mean credit card debt of recent college graduates. Conduct a complete analysis and interpret your
Step by step
Solved in 2 steps
