Chicago Connection, a local pizza company, delivers pizzas for free within the market area. The delivery drivers are paid $2.00 per delivery plus they get to keep any tips. To estimate the proportion of deliveries that result in a tip to the driver, a random sample of 64 deliveries was selected. Of these, 48 times a tip was received. Based on this information, and using a 95 percent confidence level, the upper limit for the confidence interval estimate is about .1061.

Question

Quizplus · Accepted Answer

The upper limit of a confidence interval for a proportion is calculated using the formula for the confidence interval of a proportion, which involves the sample proportion, the z-value corresponding to the confidence level, and the standard error of the proportion. The given value of .1061 seems too low to be the upper limit of the confidence interval for the proportion of deliveries that result in a tip, especially when the sample proportion (48/64 = 0.75) is much higher.

Chicago Connection, a Local Pizza Company, Delivers Pizzas for Free