Question

Mark wants to find a mean repair cost of cars, so he does research. If the sample size he is studying is 120 cars, the standard deviation of the cost of car repairs is $56. Is he uses a 99% confidence level, what is the margin of error for the population mean? Round your answer to the nearest hundredth. Use the table to find the critical value.

(1 point)
The margin of error is

1 answer

To calculate the margin of error (ME) for a population mean at a 99% confidence level, you can use the following formula:

\[ ME = Z \times \frac{\sigma}{\sqrt{n}} \]

Where:

  • \( Z \) is the critical value for the desired confidence level
  • \( \sigma \) is the standard deviation of the population
  • \( n \) is the sample size
  1. Determine the critical value \( Z \) for a 99% confidence level. From the z-table, the critical value is approximately \( Z = 2.576 \).

  2. Plug in the values:

    • \( \sigma = 56 \)
    • \( n = 120 \)

Now, calculating the standard error (SE):

\[ SE = \frac{\sigma}{\sqrt{n}} = \frac{56}{\sqrt{120}} \approx \frac{56}{10.9545} \approx 5.11 \]

  1. Calculate the margin of error:

\[ ME = Z \times SE = 2.576 \times 5.11 \approx 13.18 \]

Thus, rounding to the nearest hundredth, the margin of error is:

\[ \text{Margin of error} \approx 13.18 \]

So the final answer is:

\[ \text{The margin of error is } 13.18 \]