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Suppose that a paint supply shop wanted to estimate the correct amount of paint contained in five-litre cans purchased from a manufacturer. It is known from the manufacturer's specifications that the standard deviation of the amount of paint is equal to 0.04 l. A random sample of 50 cans is selected, and the average amount of paint per five-litre can is 4.985 l. Assume a normal distribution of fill.
(a) Set up a 99% confidence interval estimate of the true population average amount of paint included in a five-litre can. (Use the z-table.)
(b) Based on the results of (a), do you think that the store owner has a right to complain to the manufacturer? Why?
(c) Compute (a) using Excel's NORMSINV formula to find the z-value.
(d) Use Excel's CONFIDENCE function to compute (a).
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