stat 226 Confidence Interval Handout 8
1. You want to rent an unfurnished one-bedroom apartment for next semester. The mean monthly
rent for a random sample of 10 apartments advertised in the local newspaper is $540. Assume
that the standard deviation is $80.
(a) Are the conditions required to use the confidence interval met?
(b) Find a 95% confidence interval for the mean monthly rent for unfurnished one-bedroom
apartments available for rent in this community.
(c) What does this confidence interval give us?
(d) What does the term “95% confidence” mean?
(e) Compare the margin of error for intervals with 90, 95, and 99% confidence.
(f) Suppose you desire a 90% confidence interval with a width of no more than $50. What
sample size is needed?
