New Car Passion. Edmunds.com publishes information on new car prices in Car Shopping Trends Report. During a recent year, Americans spent an average of $30,803 for a new car. Assume a standard deviation of $10,200. a. Identify the population and variable under consideration. b. For samples of 50 new car sales during the year in question, determine the mean and standard deviation of all possible sample mean prices. c. Repeat part (b) for samples of size 100. d. For samples of size 1000, answer the following question without doing any computations: Will the standard deviation of all possible sample mean prices be larger than, smaller than, or the same as that in part (c)? Explain your answer.
Continuous Probability Distributions
Probability distributions are of two types, which are continuous probability distributions and discrete probability distributions. A continuous probability distribution contains an infinite number of values. For example, if time is infinite: you could count from 0 to a trillion seconds, billion seconds, so on indefinitely. A discrete probability distribution consists of only a countable set of possible values.
Normal Distribution
Suppose we had to design a bathroom weighing scale, how would we decide what should be the range of the weighing machine? Would we take the highest recorded human weight in history and use that as the upper limit for our weighing scale? This may not be a great idea as the sensitivity of the scale would get reduced if the range is too large. At the same time, if we keep the upper limit too low, it may not be usable for a large percentage of the population!
New Car Passion. Edmunds.com publishes information on new car prices in Car Shopping Trends Report. During a recent year, Americans spent an average of $30,803 for a new car. Assume a standard deviation of $10,200.
a. Identify the population and variable under consideration.
b. For samples of 50 new car sales during the year in question, determine the mean and standard deviation of all possible sample mean prices.
c. Repeat part (b) for samples of size 100.
d. For samples of size 1000, answer the following question without doing any computations: Will the standard deviation of all possible sample mean prices be larger than, smaller than, or the same as that in part (c)? Explain your answer.
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