because of uncertainty in the real estate market, many homeowners are considerin

Question

because of uncertainty in the real estate market, many homeowners are considering remodeling their homes rather than selling. Probably the most expensive room in the house to remodel is the kitchen, with an average cost of about $23,400. In terms of resale value, is remodeling the kitchen worth the cost? The following costs and resale figures are published by Remodeling magazine for 11 cities. Use these data to construct a 99% confidence interval for the difference between cost and added resale value of kitchen remodeling. Assume the differences are normally distributed in the population                 

                                                                                                                                                               solve it step by step with return back to get same answer make sure get same answer

                                                                                                                                                                                             note: do not use excel

16292                   

city cost resale Atlanta $20427 $25163 Bostan 27255 24625 Des Moines 22115 12600 Kansas City ,mo 23256 24588 Louisville 21887 19267 Portland,OR 24255 20150 Raleigh-Durham 19852 22500 Reno 23624 16667 Ridgewood,NJ 25885 26875 San Francisco 28999 35333 Tulsa 20836

16292                   

Explanation / Answer

Confidence Interval
CI = d ± t a/2 * (Sd/ Sqrt(n))
Where,
d = di/n
Sd = Sqrt( di^2 – ( di )^2 / n ] / ( n-1 ) )
a = 1 - (Confidence Level/100)
ta/2 = t-table value
CI = Confidence Interval
d = ( di/n ) =14331/11=1302.818
Pooled Sd( Sd )= Sqrt [ 262530815- (14331^2/11 ] / 10 = 4938.22
Confidence Interval = [ 1302.818 ± t a/2 ( 2851.082/ Sqrt ( 11) ) ]
= [ 1302.818 - 3.169 * (1488.929) , 1302.818 + 3.169 * (1488.929) ]
= [ -3415.599 , 6021.235 ]

X Y X-Y (X-Y)^2 20427 25163 -4736 22429696 27255 24625 2630 6916900 22115 12600 9515 90535225 23256 24588 -1332 1774224 21887 19267 2620 6864400 24255 20150 4105 16851025 19852 22500 -2648 7011904 23624 16667 6957 48399849 25885 26875 -990 980100 28999 35333 -6334 40119556 20836 16292 4544 20647936 14331 2.63E+08

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.