For the Real Estate Evaluation Project, you have been working solely with a random sample of a data set of
property prices. You found the mean price of homes, townhomes, and units of your sample. How confident can
you be that the sample means are actually representative of the true mean of the property prices of all homes,
townhomes, and units in the region represented by the data? In this discussion, you will use your data from
Part 1 of the Real Estate Evaluation Project to explore the meaning of a confidence interval. In preparation for
this discussion, it is imperative that you complete the assigned reading prior to posting, taking good notes and
working through the examples in the text (Chapter 8, “Confidence Intervals”).
For our purposes, assume that the property prices of homes are normally distributed (this is a necessary
condition for confidence intervals). The population standard deviation of the price of homes is known and is
given by σ=$704,500.
Use your data set (TAB 2) from Part 1 of the Real Estate Evaluation Project to complete the table
[DOWNLOAD]. For the sample size of n = 10, find the mean of the first 10 home prices from your random
sample. For the sample size of n = 30, find the mean of the next 30 home prices from your random sample (not
including the first ten home prices). For the sample size of n = 50, find the mean of the next 50 home prices
from your random sample, which does not include any of the home prices used prior. For the sample size of n
= 100, find the mean of the next 100 home prices from your random sample, which does not include any of the
home prices used prior, if possible. Depending on how many homes were in your random sample, you may
have to include some already-used property prices. Use technology, either Google sheets or another tool of
your choice, to find the mean of the different samples
Sample Solution
