According to USA Today, customers are not settling for automobiles straight off the production lines. As an example, those who purchase a $355,000 Rolls-Royce typically add $25,000 in accessories. One of the affordable automobiles to receive additions is BMW's Mini Cooper. A sample of 179 recent Mini purchasers yielded a sample mean of $5,000 above the $20,200 base sticker price. Suppose the cost of accessories purchased for all Mini Coopers has a standard deviation of $1,500. Determine the margin of error in estimating the average cost of accessories on Mini Coopers.
A) 219.75
B) 214.41
C) 231.14
D) 291.11

Question

Quizplus · Accepted Answer

The margin of error is 219.75. This is calculated by multiplying the standard deviation by the critical value from the t-distribution with 178 degrees of freedom and a confidence level of 95%.

According to USA Today, Customers Are Not Settling for Automobiles