Chapter 8.1, Problem 10E

Costs are rising for all kinds of medical care. According to The Wall Street Journal, the mean monthly rent at assisted-living facilities was reported to have increased 17% over the last five years to $3486. Assume this cost estimate is based on a sample of 120 facilities and, from past studies, it can be assumed that the population standard deviation is $\sigma =\$650.$
a. Develop a 90% confidence interval estimate of the population mean monthly rent.
b. Develop a 95% confidence interval estimate of the population mean monthly rent.
c. Develop a 99% confidence interval estimate of the population mean monthly rent.
d. What happens to the width of the confidence interval as the confidence level is increased? Does this seem reasonable? Explain.