PART I:

A sample was taken randomly of 675 families in the Dominican Republic, 232 responded they
could not afford $300 unexpected expenses without tapping into loans.

Define the population in this survey.

What is the population parameter estimated in this survey?

What is the point estimate for the parameter?

What is the statistic used to measure the uncertainty of the point estimate? Compute the
statistics.

Consider the true population value is found to be 40%. Would the resulting value change
much if we were to use this proportion to proportion to recompute the value of the statistic in
(d) using p=0.4?

Solutions

a) The population in this survey is all families in the Dominican Republic.

b) The population parameter estimated in this survey is the proportion of all families in
the Dominican Republic who cannot afford $300 unexpected expenses without tapping
into loans.

c) The point estimate for the parameter is the proportion of the sample who responded
they could not afford $300 unexpected expenses without tapping into loans, which is
232/675 = 0.343.

d) The statistic used to measure the uncertainty of the point estimate is the standard
error of the proportion, which is calculated as sqrt((p*(1-p))/n), where p is the point
estimate and n is the sample size. In this case, the standard error is sqrt((0.343*(1-
0.343))/675) = 0.023.

e) Using the true population value of 40% to recompute the value of the statistic in (d)
would not change the value much, since the sample size is relatively large and the
standard error is relatively small. The new standard error would be
sqrt((0.4*(1-0.4))/675) = 0.024, which is only slightly larger than the original standard
error. Therefore, the resulting value of the statistic would not change much.

PART II:
A cinema theatre conducted a random sample on 504 viewers over a period of a year and
found that 124 of them made their visit because of a coupon they had received in their mail.
Construct a 95% confidence interval for the fraction of all those viewers who made a visit
because of a coupon they’d received in the mail.

Solution