Question

STAT 211 Business Statistics I Q4. (2+5+3=10 pts.) An urban planning group is interested in estimating the difference between the mean household incomes for two neighborhoods in a large area. Independent random samples of households in the neighborhoods provided the following results. Neighborhood 1 Sample size=8 Sample mean=$15700 Sample St. Deviation=$700 Neighborhood 2 Sample size=12 Sample mean $ 14500 Sample St. Deviation=850 a. Find point estimate for the difference between the mean incomes in the two neighborhoods. b. Find a 95% confidence interval for the difference between the mean incomes. c. What assumptions were made to compute the interval estimate in part (b)? Assumptions:

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Answer 1

given D =8 D2 = 12 F, =15700; X = 14500 Si=700, S₂ = 850 a point estimate = 2 - Xz _ =15700-14500 - point estimate - 1200 - b) 95% confidence interval is C'I -=(Xi you C:I: = (X-X) *L* 2 Na C:Tcz (X-X) Et* = (1200)£ 2109 40032 + 1350)? 12 =1200 + 73242168 CI: = (467.7032, 1932.2168) C30 Samples are independent, O samples are random... © samples are from normal population.