A credit card company takes a random sample of 100 cardholders to see how much they...
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A credit card company takes a random sample of 100 cardholders to see how much they charged on their card last month. The accompanying histogram shows the frequencies in the sample. A computer program found the resulting 95% confidence interval for the mean amount spent in that month is (-$28,366.84,$90.691.49). Explain why the analysts didn't find the confidence interval useful, and explain what went wrong. ✔ Click the icon to view the histogram of charges for the last month. Choose the correct answer below. O A. The Nearly Normal Condition is not met since the data are extremely right skewed. Because of the one outlier at $3,000,000, the standard deviation is very large, which makes the t-interval too wide to be useful. O B. The software used a Normal model to construct the confidence interval when o is unknown; Student's t-model should have been used instead. O C. The Independence Assumption is not met since the data do not arise from a random sample. The sample of cardholders is not representative of the population. O D. The Nearly Normal Condition is not met since the data are extremely right-skewed. Because of the one outlier at $3,000,000, the confidence interval does not encompass all of the data values in the sample. i Histogram of Charges Click to select your answer. Frequency 100- 80- 60- 40- 20- 0- 0 1.000.000 2.000.000 3,000,000 Q - X G A credit card company takes a random sample of 100 cardholders to see how much they charged on their card last month. The accompanying histogram shows the frequencies in the sample. A computer program found the resulting 95% confidence interval for the mean amount spent in that month is (-$28,366.84,$90.691.49). Explain why the analysts didn't find the confidence interval useful, and explain what went wrong. ✔ Click the icon to view the histogram of charges for the last month. Choose the correct answer below. O A. The Nearly Normal Condition is not met since the data are extremely right skewed. Because of the one outlier at $3,000,000, the standard deviation is very large, which makes the t-interval too wide to be useful. O B. The software used a Normal model to construct the confidence interval when o is unknown; Student's t-model should have been used instead. O C. The Independence Assumption is not met since the data do not arise from a random sample. The sample of cardholders is not representative of the population. O D. The Nearly Normal Condition is not met since the data are extremely right-skewed. Because of the one outlier at $3,000,000, the confidence interval does not encompass all of the data values in the sample. i Histogram of Charges Click to select your answer. Frequency 100- 80- 60- 40- 20- 0- 0 1.000.000 2.000.000 3,000,000 Q - X G
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Related Book For
Stats Data and Models
ISBN: 978-0321986498
4th edition
Authors: Richard D. De Veaux, Paul D. Velleman, David E. Bock
Posted Date:
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