The personal of a large department corporation wants to estimate the family dent

Question

The personal of a large department corporation wants to estimate the family dental expenses of its employees to determine the feasibility of providing a dental insurance plan. A random sample of 12 employees reveals the following dental expenses (in dollars) for the preceding year:

110, 362, 246, 90, 410, 208, 173, 425, 316, 179, 280, 290

3. Set up a 95% confidence interval estimate of the average family dental expenses for all employees of this corporation. What happens when we increase the confidence level? Justtify your answer statistically speaking.

Need this question answered:

If we believe that the margin of error is quite large in part (3), what shall we do to improve our estimation results? Provide two options.

Explanation / Answer

t table value for 11 df at 95% CI is 2.201

Using online calculator we get mean=257.42 and sd=109.92

So Margin of Error=t*sd/sqrt(n)=69.84

Hence CI=mean+/-E=257.42+/-69.84=(187.58,327.26)

If you increase the confidence level width of the interval increases.

We need to remove outliers

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