A Marketing Research Company Is Estimating the Average Total Compensation

question 69

Multiple Choice

A marketing research company is estimating the average total compensation of CEOs in the service industry. Data were randomly collected from 18 CEOs and the 97% confidence interval for the mean was calculated to be ($2,181,260, $5,836,180) . What would happen to the confidence interval if the confidence level were changed to 95%?

• A) The interval would get narrower.
• B) The interval would get wider.
• C) There would be no change in the width of the interval.
• D) It is impossible to tell until the 95% interval is constructed.

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Definitions:

Variability

The degree to which scores in a set of data are spread out or differ from each other.

Asymmetrical Distribution

A situation in statistical data where the values do not mirror each other across a central point.

Positively Skewed

A distribution where the majority of scores fall on the low end of the distribution and the asymmetrical tail extends into the positive side of the graph.

Negatively Skewed

A distribution where the majority of scores fall on the upper end of the distribution and the asymmetrical tail extends into the negative side of the graph.