A marketing research company is estimating the average total compensation of CEOs in the service industry. Data were randomly collected from 18 CEOs and the 90% confidence interval for
The mean was calculated to be ($2,181,260, $5,836,180). What additional assumption is necessary
For this confidence interval to be valid?
A)The distribution of the sample means is approximately normal.
B)The sample standard deviation is less than the degrees of freedom.
C)None. The Central Limit Theorem applies.
D)The population of total compensations of CEOs in the service industry is approximately normally distributed.

Question

Quizplus · Accepted Answer

The confidence interval assumes that the population distribution is approximately normal, especially with a small sample size like 18.

A Marketing Research Company Is Estimating the Average Total Compensation