The housing market recovered slowly from the economic crisis of 2008. Recently, in one large community, realtors randomly sampled 36 bids from potential buyers to estimate the average loss in home value. The sample showed the average loss from the peak in 2008 was $9560 with astandard deviation of $1500.a) Find a 95% confidence interval for the mean loss in value per home. b) Interpret the interval you found in part (a). c) Suppose the standard deviation of the losses had been $3000 instead of $1500. What would the larger standard deviation do to the width of the confidence interval? d) If the confidence level were reduced to 90%, will the interval be wider or narrower? e) If the sample size is increased to 75 bids, will the interval be wider or narrower?
The housing market recovered slowly from the economic crisis of 2008. Recently, in one large community, realtors randomly sampled 36 bids from potential buyers to estimate the average loss in home value. The sample showed the average loss from the peak in 2008 was $9560 with a
standard deviation of $1500.
a) Find a 95% confidence interval for the mean loss in value per home.
b) Interpret the interval you found in part (a).
c) Suppose the standard deviation of the losses had been $3000 instead of $1500. What would the larger standard deviation do to the width of the confidence interval?
d) If the confidence level were reduced to 90%, will the interval be wider or narrower?
e) If the sample size is increased to 75 bids, will the interval be wider or narrower?
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