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 95% confidence interval for
The mean was calculated to be ($2,181,260, $5,836,180). What would happen to the confidence
Interval if the confidence level were changed to 90%?
A)There would be no change in the width of the interval.
B)The interval would get narrower.
C)It is impossible to tell until the 90% interval is constructed.
D)The interval would get wider.

Question

Quizplus · Accepted Answer

Lowering the confidence level from 95% to 90% decreases the critical value, which in turn reduces the margin of error, resulting in a narrower confidence interval.

A Marketing Research Company Is Estimating the Average Total Compensation