Answer :
The confidence interval does not contain the dealer's claimed mean price of $22,000, suggesting that the true mean price of three-year-old sports utility vehicles is likely higher than the dealer's claim.
What is the claim about?
Based on the sample data, we can calculate the margin of error (ME) and confidence interval (CI) to determine if the dealer's claim is likely to be true or not.
Sample mean= $22,739
Sample standard deviation (s) = $1913
Sample size (n) = 24
Margin of error (ME) = z * (s / √n) (assuming a 95% confidence level, z = 1.96)
ME ≈ 1.96 * (1913 / √24) ≈ $691.11
Confidence interval (CI) = x ± ME
CI = $22,739 ± $691.11
CI = ($22,047.89, $23,430.11)
complete question
A used car dealer says that the mean price of a three-year-old sports utility vehicle is $22,000.You suspect this claim is incorrect and find that a random sample of 24 similar vehicles has a mean price of $22,739 and a standard deviation of $1913. is this claim true?
