SOLUTION: An advertising agency wishes to estimate the proportion of households which use a particular brand of flour. i) They decide on a sample size of 500, and find that 157 households u

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Question 836188: An advertising agency wishes to estimate the proportion of households which use a particular brand of flour. i) They decide on a sample size of 500, and find that 157 households use the products. Construct a 99% confidence interval for the proportion of households. ii) How large should the sample have been for their estimate to have been in error by less than 2%?
(2+3 = 5 marks)
Answer by psbhowmick(878) About Me  (Show Source):
You can put this solution on YOUR website!
ii) The sample size can be estimated by:

N=(Z*p(1-p))/(ME)^2

p = 157/500 = 0.314
N = (2.34*0.314*0.686)/(0.02)^2 = 1260.1
Required sample size = 1261.