A marketing research company is estimating the average total compensation of CEOs in the service industry. Data were randomly collected from 18 CEOs and the 90% confidence interval for the mean was calculated to be ($2,181,260, $5,836,180). Explain what the phrase "90% confident" means.
A) In repeated sampling, 90% of the intervals constructed would contain μ.
B) 90% of the population values will fall within the interval.
C) 90% of the sample means from similar samples fall within the interval.
D) 90% of the similarly constructed intervals would contain the value of the sample mean.

Question

Quizplus · Accepted Answer

In repeated sampling, 90% of the intervals constructed would contain μ. This means that if we were to take many samples and construct a confidence interval from each, 90% of those intervals would contain the true population mean.

A Marketing Research Company Is Estimating the Average Total Compensation