Private Colleges and Universities Rely on Money Contributed by Individuals $60.2,47.0,235.1,490.0,122.6,177.5,95.4$

question 63

Short Answer

Private colleges and universities rely on money contributed by individuals and corporations for their operating expenses. Much of this money is invested in a fund called an endowment, and the college spends only the interest earned by the fund. A recent survey of eight private colleges in the United States revealed the following endowments (in millions of dollars): $60.2,47.0,235.1,490.0,122.6,177.5,95.4$ , and 220.0. Stummary statistics yield $\bar { x } = 180.975$ and $s = 143.042$ . Calculate a $99 \%$ confidence interval for the mean endowment of all private colleges in the United States.
A) $180.975 \pm 176.955$
B) $180.975 \pm 189.173$
C) $180.975 \pm 169.672$
D) $180.975 \pm 181.387$ 181.387

• A) \(180.975 \pm 176.955\)
• B) \(180.975 \pm 189.173\)
• C) \(180.975 \pm 169.672\)
• D) \(180.975 \pm 181.387\) 181.387

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Definitions:

Defaults

Failure to fulfill an obligation, especially failure to meet a financial obligation or to appear in a court of law.

Guarantor

An individual or organization that commits to taking on the debt or fulfilling the contract obligations of another party if that initial party does not uphold their responsibilities.

Subrogation

The legal process by which one party assumes the rights of another party to recover debts or damages paid on their behalf.

Surety

A surety refers to a person or entity that takes responsibility for another's performance of an undertaking, for example, guaranteeing the payment of a debt.