To find the confidence interval of the population mean when the variance is Unknown using R language

 

Aim:- To find the confidence interval of the population mean when the variance is Unknown.

Problem:

A Stock market analyst wants to estimate the average return on a certain stock. A random

sample of 15 days yields an average return of mean is 10.37% and a standard deviation of s =

3.5 %. Assuming a normal population of returns, give a 95% confidence interval for the

average return on this stock.

R- Code:-

> n=15

> xbar=10.37

> s=3.5

> sem=s/sqrt(n);sem

[1] 0.9036961

> E=qnorm(0.975)*sem;E

[1] 1.771212

> xbar+c(-E,E)

[1] 8.598788 12.141212