Tutorial Eight and Class Examples: Confidence Intervals
1. The Management of a large national chain of motels decided to estimate the mean
cost per room of repairing damages caused by its customers. A random sample of
150 vacated rooms were inspected by the management and this indicated a mean
repair cost of R84,30 and a standard deviation of R37, 20. Construct a 95%
confidence interval for the mean repair cost for the population of 2000-motel rooms.
2. A manufacture of steel beams has a production process that operates continuously
throughout an entire production shift. The beams that are produced by the process
are expected to have an average length of 295 cm (Centimetres) and the standard
deviation is known to be 2,5 cm.
At certain time interval throughout the production process, sample are selected to
determine whether the average length of the beams is still equal to 295 cm or
whether the production process has to be reset in order to change the length of the
beams produced. A random sample of 50 beams is selected and the average beam
length is found to be 294,5 cm. Construct a 99% confidence interval estimate for
the population average beam length.
3. The human resources director of a large corporation wishes to study absenteeism
among clerical workers at the corporation’s central office during the previous year.
A random sample of 25 clerical workers reveals a mean absenteeism of 9,7 days,
with a variance of 16 days.
Construct a 95% confidence interval for the average number of days of absence
for clerical workers last year. Assume that the population of absence is normally
distributed.
4. An auditor of a certain company found that the billing errors that occurred on a
random sample of invoices were:
R32; -R45; R66; R2; -R8; -R51; R12 and R18.
Positive errors indicate that the customer was billed too much and negative errors
indicate that the customer was billed too little. Find the 99% confidence interval for
the mean billing error. Assume that the population of billing errors is normally
distributed.
5. A sales manager needs to determine the proportion of defective radio returns that
is made on a monthly basis. In December 65 new radios were sold and in January
13 were returned for rework.
Estimate with 95% confidence the population proportion of returns for December.
6. According to a recent report by the Census Bureau, 26% of the single male
households own stocks, bonds and mutual funds. Although Census Bureau
estimates are based on very large sample, for convenience, assume that this result
is based on a random sample of 2 000 single male households. Find a 95%
confidence interval for the proportion of all single male households that own stocks,
bonds and mutual funds.
7. For a binding machine to work on its optimum capacity the variation in the
temperature of the room is vital. The temperature for 30 consecutive hours were
measured and sample standard deviation were found to be 0,68 degrees. What
will be a 90% confidence interval for 𝜎 2 ?
8. A precision meter is guaranteed to be accurate within 2%. A sample of five meter
readings on the same object yielded the following measurements:
350; 348; 348; 352 and 351.Construct a 99% confidence interval for 𝜎 assuming
the population of measurements is normally distributed.
