If the variance of a national accounting examination σ² is 900, how large a sample is needed to estimate the true mean score within 6 points with 99% confidence?

1 answer

To determine the required sample size for estimating the true mean with a specified level of confidence, we can use the formula for sample size in the context of confidence intervals:

\[ n = \left( \frac{Z \cdot \sigma}{E} \right)^2 \]

where:

  • \( n \) = required sample size
  • \( Z \) = Z-value corresponding to the desired confidence level
  • \( \sigma \) = population standard deviation
  • \( E \) = margin of error (the maximum amount by which we want our estimate to differ from the true mean)

Step 1: Identify the parameters

  1. Population variance \( \sigma^2 = 900 \), hence the population standard deviation \( \sigma = \sqrt{900} = 30 \).
  2. Margin of error \( E = 6 \) (points within which we want to estimate the true mean).
  3. For a 99% confidence level, the corresponding Z-value can be found using a Z-table or standard normal distribution. The Z-score for a 99% confidence level is approximately 2.576.

Step 2: Substitute the values into the formula

Now we can substitute these values into the sample size formula:

\[ n = \left( \frac{Z \cdot \sigma}{E} \right)^2 \] \[ n = \left( \frac{2.576 \cdot 30}{6} \right)^2 \]

Step 3: Calculate

Calculating the numerator:

\[ Z \cdot \sigma = 2.576 \cdot 30 = 77.28 \]

Now calculating \( \frac{Z \cdot \sigma}{E} \):

\[ \frac{77.28}{6} = 12.88 \]

Now squaring this result to find \( n \):

\[ n = (12.88)^2 \approx 165.71 \]

Since the sample size must be a whole number, we round up to ensure we have enough observations:

\[ n \approx 166 \]

Conclusion

Thus, the required sample size to estimate the true mean score within 6 points with 99% confidence is 166.