Reference no: EM131098282

Confidence interval for the difference of population means: Z test

For a study conducted by the research department of a pharmaceutical company, 295 randomly selected individuals were asked to report the amount of money they spend annually on prescription allergy relief medication. The sample mean was found to be $17.70  with a standard deviation of $4.30. A random sample of 250 individuals was selected independently of the first sample. These individuals reported their annual spending on non-prescription allergy relief medication. The mean of the second sample was found to be $18.30 with a standard deviation of $3.50. As the sample sizes were quite large, it was assumed that the respective population standard deviations of the spending for prescription and non-prescription allergy relief medication could be estimated as the respective sample standard deviation values given above. Construct a 95% confidence interval for the difference between M₁ - M₂ the mean spending on prescription allergy relief medication (M₁) and the mean spending on non-prescription allergy relief medication (M₂). Then complete the table below.

Carry your intermediate computations to at least three decimal places. Round your answers to at least two decimal places. (If necessary, consult a list of formulas.)

a) What is the lower limit of the 95% confidence interval?

b) What is the upper limit of the 95% confidence interval?