Question

The mean amount μ for all of the invoices for your company last month is not known. Based on your past experience, you are willing to assume that the standard deviation of invoice amounts is about $200. If you take a random sample of 100 invoices, what is the value of the standard deviation for x?

Answer 1

σ = $20

Explanation:

The standard deviation of a sample mean is given by:

`\sigma_x = (\sigma)/(√(n))`

Where σ is the mean standard deviation and n is the random sample size.

In this case, the mean standard deviation is σ = $200 and the sample size is n = 100, therefore:

`\sigma_x = (200)/(√(100))\\\sigma_x = \$ 20`

The standard deviation for x is $20.