TABLE 8-2 A Wealthy Real Estate Investor Wants to Decide Whether It

question 113

Short Answer

TABLE 8-2
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 near 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 8-2, what will be the 90% confidence interval for the population proportion of houses that will be appraised for higher than the market prices?

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Definitions:

Positive Correlation

A relationship between two variables where an increase in one variable is associated with an increase in the other variable.

Achievement Tests

Standardized tests designed to assess a person's level of skill, accomplishment, or knowledge in a specific area.

Nurture

The influence of external factors like environment and upbringing on the development and behavior of an individual.

Development

is the process of change and growth over time, which can include physical, cognitive, emotional, and social aspects.