3. An economist aims to conduct a study on the crime rate (the ratio of...
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3. An economist aims to conduct a study on the crime rate (the ratio of crimes in an area to the population of that area; expressed per 1000 population per year) for the cities with high level of economic development (as measured in thousands of dollars for per capita GDP). She has read a study which claimed the crime rate to be 10 percent for such cities, but she thinks the crime rate is significantly different (probably lower) for such cities. In order to confirms her idea, she gathers data over 225 developed cities and the sample of data reveals a crime rate of 5 percent with a standard deviation of 2.55
a. Can she successfully back up her idea and reject the null of 10 percent or not?
b. What is the 95% confidence interval for the average crime rate in such cities according to the sample she gathered? Does it include 10 or not? Explain.
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