Previous research indicates that 20% of homeowners do not carry sufficient homeowners' insurance to adequately protect their investment.We wish to estimate the percentage of homeowners in a particular suburban area who do not have adequate insurance.How many homes should we sample if we desire a 95% confidence interval with a width of no more than 6%?
A) 171
B) 1068
C) 267
D) 683

Question

Quizplus · Accepted Answer

To determine the sample size for a proportion with a given confidence interval width, we use the formula n = (Z^2 * p * (1-p)) / E^2. For a 95% confidence interval, Z is approximately 1.96. Given p = 0.20 and E = 0.03 (half of 6%), the calculation results in approximately 683.

Previous Research Indicates That 20% of Homeowners Do Not Carry