Math Problem Statement

From a large number of actuarial exam scores, a random sample of 300 scores is selected, and it is found that 225 of these 300 are passing scores. Based on this sample, find a 95% confidence interval for the proportion of all scores that are passing. Then find the lower limit and upper limit of the 95% confidence interval. Carry your intermediate computations to at least three decimal places. Round your answers to two decimal places. (If necessary, consult a list of formulas.)

Lower limit:

Upper limit:

Solution

To find a 95% confidence interval for the population proportion pp of passing scores, we can use the following formula:

p^±Zp^(1p^)n\hat{p} \pm Z \cdot \sqrt{\frac{\hat{p}(1 - \hat{p})}{n}}

Where:

  • p^\hat{p} = sample proportion = 225300\frac{225}{300}
  • n=300n = 300 is the sample size
  • ZZ is the Z-value for a 95% confidence level, which is 1.96.

Step 1: Calculate the sample proportion p^\hat{p}

p^=225300=0.750\hat{p} = \frac{225}{300} = 0.750

Step 2: Calculate the standard error (SE)

SE=p^(1p^)n=0.750(10.750)300SE = \sqrt{\frac{\hat{p}(1 - \hat{p})}{n}} = \sqrt{\frac{0.750(1 - 0.750)}{300}} SE=0.750×0.250300=0.1875300=0.000625=0.025SE = \sqrt{\frac{0.750 \times 0.250}{300}} = \sqrt{\frac{0.1875}{300}} = \sqrt{0.000625} = 0.025

Step 3: Calculate the margin of error (ME)

ME=Z×SE=1.96×0.025=0.049ME = Z \times SE = 1.96 \times 0.025 = 0.049

Step 4: Calculate the confidence interval

p^±ME=0.750±0.049\hat{p} \pm ME = 0.750 \pm 0.049

  • Lower limit: 0.7500.049=0.7010.750 - 0.049 = 0.701
  • Upper limit: 0.750+0.049=0.7990.750 + 0.049 = 0.799

Final Answers:

  • Lower limit: 0.700.70
  • Upper limit: 0.800.80

Would you like further clarifications or have any additional questions?


Here are 5 related questions you could explore:

  1. What happens to the confidence interval if the confidence level is increased to 99%?
  2. How does sample size impact the width of the confidence interval?
  3. What is the interpretation of a confidence interval in the context of a population proportion?
  4. Can we assume normality when constructing confidence intervals for proportions?
  5. How would the interval change if only 150 scores were passing instead of 225?

Tip: Confidence intervals provide a range of plausible values for a population parameter, but they are not guarantees!

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Math Problem Analysis

Mathematical Concepts

Statistics
Confidence Interval
Proportion

Formulas

Confidence Interval Formula: p̂ ± Z * √(p̂(1 - p̂) / n)
Sample Proportion Formula: p̂ = x / n
Standard Error (SE) Formula: SE = √(p̂(1 - p̂) / n)

Theorems

Central Limit Theorem (for large samples)
Normal Approximation to Binomial Distribution

Suitable Grade Level

Undergraduate