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Golf club repairs The Ping Company makes custom-built golf clubs and competes in the $4billion golf equipment industry. To improve its business process, Ping decided to study the time it took to repair golf clubs sent to the company by mail. The company determined that 16%of a random sample of orders were sent back to the customers in 5days or less. Ping examined the processing of repair orders and made changes. Following the changes, 90%of a random sample of orders were completed within 5days. Assume that each of the estimated percent is based on a random sample of n orders.

(a) We used the sample data to construct two 90% confidence intervals for the proportion of orders completed within 5 days-one before and one after the changes at Ping. The two intervals are (0.858,0.942) and (0.109,0.211). Find the value of n.

(b) Explain why the interval (0.858-0.211,0.942-0.109)=(0.647,0.833) is not a 95% confidence interval for the improvement in the proportion of orders sent back to customers within 5 days following the change.

(c) Construct and interpret a correct 95% confidence interval to replace the one in part (b).

Short Answer

Expert verified

a). The sample size is most probable n=139.

b). The interval was built in order to obtain an approximation of the population proportions difference.

c). There is confidence in 95 percent that the real gap in population proportion is between 0.6612 and 0.8188.

Step by step solution

01

Part (a) Step 1: Given Information

90%confidence interval: (0.858,0.942)

90%confidence interval: (0.109,0.211)

localid="1650368097744" p^1=90%

=0.90

localid="1650368115748" p^2=16%

=0.16

02

Part (a) Step 2: Explanation

The margin of error is

E1=0.042

E2=0.051

For confidence level 1-α=0.90

zα/2=z0.05

zα/2=1.645

p^is known,

n1=zÓ¬222p^(1-p^)E2

=1.6452×0.90(1-0.90)0.0422

=138

n2=zα22p^(1-p^)E2

=1.6452×0.16(1-0.16)0.0512

=140

The sample size must be equal (due to rounding errors they are not equal) and therefore the sample size is most probable

03

Part (b) Step 1: Given Information

The Ping Company makes custom-built golf clubs and competes in the $4 billion golf equipment industry.

04

Part (b) Step 2: Explanation

The interval was built in order to obtain an approximation of the population proportions difference. However, the two sample z-test used the confidence interval of the population difference, and this is not the variation of the confidence intervals derived from the one-sample z-test

05

Part (c) Step 1: Given Information

p^1=90%=0.90

p^2=16%=0.16

n=139

06

Part (c) Step 2: Explanation

The confidence interval endpoints for are then:

p^1-p^2-zα/2×p^11-p^1n1+p^21-p^2n2

p^1-p^2+zα/2×p^11-p^1n1+p^21-p^2n2

For confidence level 1-α=0.95,

zα/2=z0.025

1-α=0.95

07

Part (c) Step 3: Explanation

The confidence interval endpoints for are then

p^1-p^2-zα/2×p^11-p^1n1+p^21-p^2n2

=(0.90-0.16)-1.960.90(1-0.90)139+0.16(1-0.16)139

=0.6612

p^1-p^2+zα/2×p^11-p^1n1+p^21-p^2n2

=(0.90-0.16)+1.960.90(1-0.90)139+0.16(1-0.16)139

=0.8188

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