Solve the problem You are interested in purchasing a new car. One of the many po

Question

Solve the problem
You are interested in purchasing a new car. One of the many points you wish to consider is the resale value of the car after 5 years of ownership. Since you are particularly interested in a certain foreign sedan, you decide to estimate the resale value of this car with a 90% confidence interval. You manage to obtain data on 17 recently resold 5-year-old foreign sedans of the thst model. These 17 cars were resold at an average price of $12,640 with a sample standard deviation of $600. Assuming the involved population is approximately normal, what is the correct form of a 90% confidence interval for the true mean resale value of a 5 year old specific foreign sedan?

Explanation / Answer

xbar +/- t* S / srqt (n)

alpha = 0.10   alpha / 2 = 0.05   df = 16 t =1.746

I: 12640 +/- 1.746 * 600 / srqt (17)

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