Private colleges and universities rely on money contributed by individuals and corporations for their operating expenses. much of this money is invested in a fund called an endowment, and the college spends only the interest earned by the fund. A recent survey of eight private colleges in the United States resulted in the following summary statistics for their endowments(in millions of dollars) x̅ = 180.975 and s =143.042. Calculate a 99% confidence interval for the mean endowment of all private colleges in the United States.
Continuous Probability Distributions
Probability distributions are of two types, which are continuous probability distributions and discrete probability distributions. A continuous probability distribution contains an infinite number of values. For example, if time is infinite: you could count from 0 to a trillion seconds, billion seconds, so on indefinitely. A discrete probability distribution consists of only a countable set of possible values.
Normal Distribution
Suppose we had to design a bathroom weighing scale, how would we decide what should be the range of the weighing machine? Would we take the highest recorded human weight in history and use that as the upper limit for our weighing scale? This may not be a great idea as the sensitivity of the scale would get reduced if the range is too large. At the same time, if we keep the upper limit too low, it may not be usable for a large percentage of the population!
Private colleges and universities rely on money contributed by individuals and corporations for their operating expenses. much of this money is invested in a fund called an endowment, and the college spends only the interest earned by the fund. A recent survey of eight private colleges in the United States resulted in the following summary statistics for their endowments(in millions of dollars) x̅ = 180.975 and s =143.042. Calculate a 99% confidence interval for the mean endowment of all private colleges in the United States.
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