The standard deviation of the daily demand for a product is an important factor for inventory
The standard deviation of the daily demand for a product is an important factor for inventory control for the product. Suppose that a pharmacy wants to estimate the standard deviation of the daily demand for a certain antibiotic. It is known that the daily demand for this antibiotic follows an approximately normal distribution. A random sample of 23 days has a sample mean of 120 orders for this antibiotic with a standard deviation of 10.1 orders. Find a 95% confidence interval for the population standard deviation of the daily demand for this antibiotic.
1. What is the lower limit of the 95% confidence interval?
2. What is the upper limit of the 95% confidence interval?