EXAMPLE 6.6

How the confidence level affects the confidence interval. Suppose that for the college saving fund contribution data in Example 6.4 (page 350), we wanted 99% confidence. Table D tells us that for 99% confidence, z* = 2.576. The margin of error for 99% confidence based on 1593 observations is

and the 99% confidence interval is

= (1672, 1864)

Requiring 99%, rather than 95%, confidence has increased the margin of error from 37 to 96. Figure 6.6 compares the two intervals.