A consumer group wants to estimate the meanelectric bill for the month of July for single family-homes in a large city. Based on studies conducted in other cities, the standard deviationis assumed to be $25. The group wants to estimate the mean bill for July to within + or – $5 with 99% confidence.
a. What sample size is needed?
b. If 95% of confidence is desired, how many homes need to be selected?
This solution explains how to determine the sample size required for the given study.