A survey of 50 retail stores revealed that the average price of a microwave was $375 with a standard error of $20. Assuming the population is normally distributed, what is the 99% confidence interval to estimate the true cost of the microwave?
A) $367.42 to $382.58
B) $315.00 to $415.00
C) $323.40 to $426.60
D) $335.82 to $414.28

Question

Quizplus · Accepted Answer

The correct answer is A because the 99% confidence interval is calculated as the sample mean plus or minus 2.576 times the standard error. Therefore, the 99% confidence interval is $375 +/- 2.576 * $20 = $367.42 to $382.58.

A Survey of 50 Retail Stores Revealed That the Average