A. A trucking company continuously monitors the tread remaining on its fleet of truck tires. The firm knows that standard deviation is 0.1 cm. Suppose a

sample of 80 tires were obtained, and the mean tread was 2.2 cm. Construct a 99% confidence interval. The company’s operations manager knows that flat tires

occur more often when the tread is below 1.0 cm. At what sample mean (and higher) should the company reasonably expect minimal flat tires, based on a 95%

confidence interval?

B. Monthly expenses for an advertising agency were obtained for the previous year. The sample of 12 expenses showed a mean of $196,000, with a standard

deviation of $45,000. The office manager is budgeting for monthly expenses, and would like to know if it is reasonable to expect expenses to be below

$250,000. Construct a 95% confidence interval to justify if $250,000 is reasonable.

C. As the operator of an e-commerce web site, you are interested in monitoring the average time spent on the site. How large of a sample of usage times should

be obtained, provided your allowable error is 30 seconds. Based on a long history, you know the standard deviation of usage times is 5 minutes. Assume a 90%

level of confidence.