TABLE 8-4
To become an actuary, it is necessary to pass a series of 10 exams, including the most important one, an exam in probability and statistics. An insurance company wants to estimate the mean score on this exam for actuarial students who have enrolled in a special study program. They take a sample of 8 actuarial students in this program and determine that their scores are: 2, 5, 8, 8, 7, 6, 5, and 7. This sample will be used to calculate a 90% confidence interval for the mean score for actuarial students in the special study program.
-Referring to Table 8-4, it is possible that the confidence interval obtained will not contain the mean score for all actuarial students in the special class.

Question

TABLE 8-4
 To become an actuary, it is necessary to pass a series of 10 exams, including the most important one, an exam in probability and statistics. An insurance company wants to estimate the mean score on this exam for actuarial students who have enrolled in a special study program. They take a sample of 8 actuarial students in this program and determine that their scores are: 2, 5, 8, 8, 7, 6, 5, and 7. This sample will be used to calculate a 90% confidence interval for the mean score for actuarial students in the special study program.
-Referring to Table 8-4, it is possible that the confidence interval obtained will not contain the mean score for all actuarial students in the special class.

Quizplus · Accepted Answer

A confidence interval provides a range of values within which the true population mean is likely to fall, but there is still a chance (in this case, 10%) that the interval does not contain the true mean.

TABLE 8-4 to Become an Actuary, It Is Necessary to Pass