A local men's clothing store is being sold. The buyers are trying to estimate the percentage of items that are outdated. They will choose a random sample from the 100,000 items in the store's inventory in order to determine the proportion of merchandise that is outdated. The current owners have never determined the percentage of outdated merchandise and cannot help the buyers. How large a sample do the buyers need in order to be 99% confident that the margin of error of their estimate is about 3%?
A) 1842
B) 3684
C) 7368
D) 716

Question

Quizplus · Accepted Answer

The sample size needed to achieve a 99% confidence level with a margin of error of 3% is 1842. This can be calculated using the formula: n = (Z^2 * p * q) / e^2, where Z is the z-score for the desired confidence level, p is the estimated proportion of outdated merchandise, q is the complement of p (1 - p), and e is the margin of error.

A Local Men's Clothing Store Is Being Sold