From an industrial area 70 companies were selected at random and 45 of them were panning for expansion next year. Find 95% confidence limit for the proportion of companies planning for expansion?

Respuesta :

Answer:

Confidence limit = [52.8%, 75.2%]

Step-by-step explanation:

[tex]P=\frac{45}{70}= 0.64[/tex]

[tex](1-P)=1-0.64=0.36[/tex]

[tex]n= 70[/tex]

[tex]P[/tex] ± [tex]z[/tex] [tex]\sqrt{\frac{P(1-P)}{n} }[/tex]

where the value [tex]z[/tex] will be taken from the z-table for 95% confidence interval

1-0.95= 0.05/2= 0.025

0.95+0.025= 0.0975

From the z-table the value of [tex]z[/tex] corresponding to 0.0975 is 1.96

[tex]0.64[/tex] ± [tex]1.96[/tex] [tex]\sqrt{\frac{0.64*0.36}{70} }[/tex]

[tex]0.64[/tex] ± [tex]1.96[/tex] [tex](0.057)[/tex]

[tex]0.64[/tex] ± [tex]0.112[/tex]

[tex]64%[/tex]% ± [tex]11.2[/tex]%

so the confidence interval is

[tex]64+11.2=75.2[/tex]%

[tex]64-11.2=52.8[/tex]%

[tex][52.8, 75.2][/tex]