AP Statistics Worksheet Chapter 23 Name: _________________________ 1. Insurance companies track life expectancy information to assist in determining the cost of life insurance policies. Insurance Premium Company wants to determine the life expectancy of their clients so that they can reassess their costs. They randomly sample 20 of the recently paid policies. Below are the results. 86 75 83 84 81 77 78 79 79 81 76 85 70 76 79 81 73 74 72 83 a. Find the 95% confidence interval for the life expectancy of Insurance Premium Company’s clients. Interpret your interval. b. Last year the life expectancy for the company’s clients was 77 years. Does this sample indicate that the life expectancy has changed? Explain. Use your results from part a. c. In part b, what alpha level were you using? d. Suppose you wanted to use an alpha level of .01, what confidence level should you use in making a confidence interval? e. Suppose you want to have an alpha level of .05 and want to determine if the life expectancy of the company’s clients has increased from last year. If you are using a confidence interval to obtain your answer, what confidence level should you use in making a confidence interval? f. For more accurate cost determination, the insurance company wants to estimate the life expectancy to within one year with 95% confidence. How many randomly selected records would they need to have? 2. A professor at a large university believes that students take an average of 15 credit hours per term. A random sample of 24 students in her class of 250 students reported the following number of credit hours they were taking: 12 13 14 14 15 15 15 16 16 16 16 16 17 17 17 18 18 18 18 19 19 19 20 21 a. Does this sample indicate that students are taking more credit hours than the professor believes? Test an appropriate hypothesis and state your conclusion. b. Find a 95% confidence interval for the number of credit hours taken by the students in the professor’s class. Interpret your confidence level.