TABLE 8-18 A Wealthy Real Estate Investor Wants to Decide Whether It

question 6

Short Answer

TABLE 8-18
A wealthy real estate investor wants to decide whether it is a good investment to build a high-end shopping complex in a suburban county in Chicago.His main concern is the total market value of the 3,605 houses in the suburban county.He commissioned a statistical consulting group to take a sample of 200 houses and obtained a sample mean market price of $225,000 and a sample standard deviation of $38,700.The consulting group also found out that the mean differences between market prices and appraised prices was $125,000 with a standard deviation of $3,400.Also the proportion of houses in the sample that are appraised for higher than the market prices is 0.24.
-Referring to Table 8-18,what will be the 90% confidence interval for the total difference between the market prices and appraised prices of the houses in the suburban county constructed by the consulting group?

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Definitions:

Annual Growth

The increase in the value of an economy's goods and services over a one-year period, typically expressed as a percentage.

Per Capita GDP Growth

measures the rate of growth in the average economic output per person, indicating the economic progress of a country on an individual level.

Major Industrial Country

A country that is highly developed and has a significant influence on the global economy due to its industrial capabilities.

West Germany

The name for the Federal Republic of Germany during the period between its formation in 1949 and German reunification in 1990.