Suppose that 20% of the households in Alberta have incomes in excess of $60,000. Assume that a random sample of 500 households in Alberta is taken. What will be the standard error of the sampling distribution of sample proportion of households that have incomes in excess of $60,000?
A) 0.0003
B) 0.0179
C) 0.0256
D) 0.1600

Question

Quizplus · Accepted Answer

The formula for calculating the standard error of sample proportion is:
SE = sqrt[p(1-p)/n]

where p is the population proportion (0.20) and n is the sample size (500).

SE = sqrt[0.20(1-0.20)/500]
SE = sqrt[0.16/500]
SE = 0.0179

Therefore, the standard error of the sampling distribution of sample proportion of households that have incomes in excess of $60,000 is 0.0179 or approximately 0.02. The best choice is B.

Suppose That 20% of the Households in Alberta Have Incomes