A retired statistician was interested in determining the average cost of a $200,000.00 term life insurance policy for a 60-year-old male non-smoker. He randomly sampled 65 subjects
(60-year-old male non-smokers) and constructed the following 95 percent confidence interval for the mean cost of the term life insurance: ($850.00, $1050.00). Explain what the phrase "95 percent confident" means in this situation.
A) 95 percent of all the life insurance costs will fall within the specified interval.
B) In repeated sampling, 95 percent of the intervals constructed would contain the value of the true population mean.
C) 95 percent of all retired statisticians are underinsured.
D) In repeated sampling, the mean of the population will fall within the specified intervals 95 percent of the time.

Question

A retired statistician was interested in determining the average cost of a $200,000.00 term life insurance policy for a 60-year-old male non-smoker. He randomly sampled 65 subjects
 (60-year-old male non-smokers) and constructed the following 95 percent confidence interval for the mean cost of the term life insurance: ($850.00, $1050.00). Explain what the phrase "95 percent confident" means in this situation.
A) 95 percent of all the life insurance costs will fall within the specified interval.
B) In repeated sampling, 95 percent of the intervals constructed would contain the value of the true population mean.
C) 95 percent of all retired statisticians are underinsured.
D) In repeated sampling, the mean of the population will fall within the specified intervals 95 percent of the time.

Quizplus · Accepted Answer

In repeated sampling, 95 percent of the intervals constructed would contain the value of the true population mean.

A Retired Statistician Was Interested in Determining the Average Cost