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 99% confidence interval for the mean was calculated to be ($2,181,260, $5,836,180). Explain what the phrase "99% confident" means.

A) 99% of the similarly constructed intervals would contain the value of the sample mean.
B) In repeated sampling, 99% of the intervals constructed would contain µ.
C) 99% of the population values will fall within the interval.
D) 99% of the sample means from similar samples fall within the interval.

Question

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 99% confidence interval for the mean was calculated to be ($2,181,260, $5,836,180) . Explain what the phrase "99% confident" means.

A) 99% of the similarly constructed intervals would contain the value of the sample mean.
B) In repeated sampling, 99% of the intervals constructed would contain µ.
C) 99% of the population values will fall within the interval.
D) 99% of the sample means from similar samples fall within the interval.

Quizplus · Accepted Answer

In repeated sampling, 99% of the intervals constructed would contain the true population mean (µ).

A Marketing Research Company Is Estimating the Average Total Compensation