Bhavana, an employee of Karuna Lights and Tubes who is a manufacturer of

electric bulbs, is trying to estimate the average lifetime of bulbs produced on a

particular day. Based on the previous production, she had estimated the standard
deviation (  )of the lifetime. After taking a sample of 100, she had calculated a
two-sided 95% confidence interval whose lower limit turned out to be 830.5
hours. When the management complained that the width of the confidence
interval is too large, she simply reduced the confidence level to .90 (still two-
sided) and came up with a lower limit of the confidence interval at 836.8 hours.
The management is willing to accept an estimate of the mean that is within 19.6
above or below the point estimate but the chances of this estimate being
incorrect must be only 1 in 20.

1. What was the original two sided 95% confidence interval of the lifetime?

2. What was the revised confidence interval with a confidence level of .95?

3. What should be the sample size to satisfy the requirements of the

management?

4. When Bhavana selected a new sample with size as determined in (3) above,
the sample mean turned out to be 30 hours more than the previous sample
mean. Calculate the two-sided confidence interval as desired by the
management, based on the new sample.
 The weight of oranges produced by the MoneyWorth Orchards is
distributed normally with mean  and standard deviation . The oranges
which weigh more than 266 gms. are exported and those with weight less
than 100 gms. are sold to the local fruit juice factory. When MoneyWorth
Orchards estimated a two-sided 95% confidence interval for  based on the
known value of , the width of the interval turned out to be 39.2.
Considering that the standard error is inversely proportional to the square
root of the sample size, they increased the sample size by 300 more
oranges, and the width was exactly halved (i. e., it became 19.6). They
have exported 12.30% of their production.

1. What is the value of ?

2. What is the value of ?

3. What percentage of the production was sold to the local fruit juice factory?

Question

Many public polling agencies conduct surveys to determine the current

consumer sentiment concerning the state of the economy. One such
agency randomly sampled 484 consumers and found that 257 were
optimistic about the state of the economy.

1 Develop a 95% confidence interval for the proportion of consumers who

are optimistic about the state of the economy.

2 Based on the above, is it possible to conclude that the majority of the

consumers are optimistic about the state of the economy?

3 If the true proportion of consumers optimistic about the economy was 0.5,
what is the probability that 257 or more in a sample of 484 are optimistic
about the state of the economy?