The most preferableoptionwould be spending more on data collection and having a smaller margin of error. It is better to have a moreaccurateprice range of the houses in the new area. If the margin of error is small, it shows that the estimate is closer to the real value. The sample size of 1,000 listings would be preferred due to its small margin of error.

Confidence interval

For a sample size of 100,

Given mean= $310,000

Confidence Interval (CI)=310,000

CI= ($285,000, $335,000)

For a sample size of 1000

CI= 310,000

CI= ($305,000, $ 315,000)

I am 95 % confident the true mean of the Northeast house listing price is between $305,000 and$315,000.

The confidence interval $285,000, $335,000) is wide while the confidence interval ($305,000, $ 315,000) is narrow. The agents are likely to prefer the narrow confidence interval because it is moreaccurate,and they can rely on it.

The factors that went into recommendation are the margin of error and the mean of the Northeast house. The margin of error tells us how many percentage points the sample statistic will differ from the true population. The margin of error should beacceptable,and the data collection cost should be less.

THE QUESTION IS THIS:

As company CEO, I appreciate and understand your definition of margin of error. However, we cannot afford $10000 at this time, so do you have another recommendation?