In order to set rates, an insurance company is trying to estimate the number of sick days that full time workers at an auto repair shop take per year. A previous study indicated that the standard...

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In order to set rates, an insurance company is trying to estimate the number of sick days that full time workers at an auto repair shop take per year. A previous study indicated that the standard deviation was 2.8 days. How large a sample must be selected if the company wants to be 95% confident that the true mean differs from the sample mean by no more than 1 day?



Answered Same DayDec 20, 2021

Answer To: In order to set rates, an insurance company is trying to estimate the number of sick days that full...

Robert answered on Dec 20 2021
134 Votes
The standard deviation is 2.8 days
Let n be the sample size
95% confidence interval => Z= 1.96

Margin of error,E= 1
By Formula , E= Z*s/sqrt(n)
 n= Z^2*s^2/E^2
 n=30.11
 n~31
Thus a sample of size 31 must be selected
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