Answer to Question #226866 in Economics of Enterprise for rong

Question

The useful life of a certain type of light bulb is known to have a= 40 hours. Hoe large a sample should be taken standard deviation of it is desired to have a margin of error of 10 hours or less at a 95% level of confidence?

Answer 1

useful life =40 hours

Margin of Error= 10 hours

At 95% level of confidence

$n=(\frac {(z)(\sigma)}{MOE})^2$

For 95% level of confidence, standard deviation $\sigma$ = 0.05

$\therefore$ $n=(\frac {(40)(0.05)}{10})^2$

$=0.04$

$\implies$Interval of the sample ranges up to 0.04 (overall upper limit)