Chapter 9, Problem 1SR

a.

To determine

Find the population mean of daily sales for Bun-and-Run franchise.

Explanation of Solution

Here, the sample mean is provided and there is no information about the population mean of daily sales for Bun-and-Run franchise.

b.

To determine

Find the best estimate of the population mean.

Answer to Problem 1SR

The best estimate of the population mean is $20,000.

Explanation of Solution

Calculation:

The sample mean is the point estimate of the population mean. Moreover, the sample statistic gives the best estimate for the population parameter.

Here, the sample mean is $20,000. Hence, the point estimate of the population mean is $20,000. That is, the best estimate for the population mean is the sample mean, which is denoted as $\underset{\_}{\overline{x}=\$20,000}$.

c.

To determine

Find the 95% confidence interval for the population mean of daily sales.

Answer to Problem 1SR

The 95% confidence interval for the population mean of daily sales is $\underset{\_}{\left(\$19,070,\$20,930\right)}$.

Explanation of Solution

Calculation:

Step-by-step procedure to obtain the confidence interval using MINITAB software is given below:

• Choose Stat > Basic Statistics > 1-Sample Z.
• In Summarized data, enter the sample size as 40 and mean as 20,000.
• In Standard deviation, enter 3,000.
• Check Options, enter Confidence level as 95.
• Choose Mean ≠ Hypothesized mean in alternative.
• Click OK in all dialogue boxes.

Output using MINITAB software is given below:

From the MINITAB output, the 95% confidence interval for the population mean of daily sales is $\underset{\_}{\left(\$19,070,\$20,930\right)}$.

d.

To determine

Interpret the confidence interval in Part (c).

Explanation of Solution

Interpretation:

There is 95% confidence that the population mean of daily sales lies between $19,070 and $20,930.