One of your employees has suggested that your company develop a new product. You
ID: 3178897 • Letter: O
Question
One of your employees has suggested that your company develop a new product. You decide to take a random sample of your customers end ask whether or not there is interest in the new product. The response is on a 1 to 5 scale with 1 Indicating "definitely would not purchase"; 2. "probably would not purchase"; 3, "not sure"; 4. "probably would purchase"; and 5, "definitely would purchase." For an initial analysis, you will record the responses 1, 2, and 3 as "No" and 4 and 5 as "Yes." What sample size would you use If you wanted the 99% margin of error to be 0.05 or less? (Round your answer up to the nest whole number.)Explanation / Answer
Compute Sample Size ( n ) = n=(Z/E)^2*p*(1-p)
Z a/2 at 0.01 is = 2.576
Sample Proportion = 0.5
ME = 0.05
n = ( 2.576 / 0.05 )^2 * 0.5*0.5
= 663.578 ~ 664
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