2nd Edition

ISBN: 9781259570643

Author: Navidi

Publisher: MCG

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Chapter 7.2, Problem 32E

Mortgage rates: Following are interest rates (annual percentage rates) for a 30-year fixed rate mortgage from a sample of lenders in Macon, Georgia. It is reasonable to assume that the population is approximately normal.

Chapter 7.2, Problem 32E, Mortgage rates: Following are interest rates (annual percentage rates) for a 30-year fixed rate

Source: www.bankrate.com

a. Construct a 99% confidence interval for the mean rate.
b. One week earlier, the mean rate was 4.050%. A mortgage broker claims that the mean rate is now higher. Based on the confidence interval, is this a reasonable claim? Explain.

Definition Definition Measure of central tendency that is the average of a given data set. The mean value is evaluated as the quotient of the sum of all observations by the sample size. The mean, in contrast to a median, is affected by extreme values. Very large or very small values can distract the mean from the center of the data. Arithmetic mean: The most common type of mean is the arithmetic mean. It is evaluated using the formula: μ = 1 N ∑ i = 1 N x i Other types of means are the geometric mean, logarithmic mean, and harmonic mean. Geometric mean: The nth root of the product of n observations from a data set is defined as the geometric mean of the set: G = x 1 x 2 ... x n n Logarithmic mean: The difference of the natural logarithms of the two numbers, divided by the difference between the numbers is the logarithmic mean of the two numbers. The logarithmic mean is used particularly in heat transfer and mass transfer. ln x 2 − ln x 1 x 2 − x 1 Harmonic mean: The inverse of the arithmetic mean of the inverses of all the numbers in a data set is the harmonic mean of the data. 1 1 x 1 + 1 x 2 + ...

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Chapter 7.2, Problem 31E

Chapter 7.2, Problem 33E

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Chapter 7 Solutions

Essential Statistics

Ch. 7.1 - Prob. 1CYU Ch. 7.1 - Prob. 2CYU Ch. 7.1 - Prob. 3CYU Ch. 7.1 - Prob. 4CYU Ch. 7.1 - Prob. 5CYU Ch. 7.1 - Prob. 6CYU Ch. 7.1 - Prob. 7CYU Ch. 7.1 - Prob. 8CYU Ch. 7.1 - Prob. 9CYU Ch. 7.1 - 10. Using the output in Exercise 9: Find the...

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Solution Summary: The author explains that the data represents the interest rates (annual percentage rated) for 30-year fixed rate mortgage from a sample of lenders in Macon, Georgia.

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Chapter 7 Solutions