A stationery store wants to estimate the mean retail value of greeting cards that it has in its inventory. A random sample of 100 greeting cards indicates a mean value of $2.55 and a standard deviation of $0.44.
A) Assuming a normal distribution, construct a 95% confidence interval estimate of the mean value of all greeting cards in the store’s inventory.
B) Suppose there were 2,500 greeting cards in the store’s inventory. How are the results in (a) useful in assisting the store owner to estimate the total value of her inventory?
The U.S. Department of Transportation requires tire manufacturers to provide tire performance information on the sidewall of the tire to better inform prospective customers when making purchasing decisions. One very important measure of tire performance is the tread wear index, which indicates the tire’s resistance to tread wear compared with a tire graded with a base of 100. This means that a tire with a grade of 200 should last twice as long, on average, as a tire graded with a base of 100. A consumer organization wants to estimate the actual tread wear index of a brand name of tires that claims “graded 200” on the sidewall of the tire. A random sample of n = 18 indicates a sample mean tread wear index of 195.3 and a sample standard deviation of 21.4.
A) Assuming that the population of tread wear indexes is normally distributed, construct a 95% confidence interval estimate of the population mean tread wear index for tires produced by this manufacturer under this brand name.
B) Do you think that the consumer organization should accuse the manufacturer of producing tires that do not meet the performance information provided on the sidewall of the tire? Explain.