Question: The Internal Revenue Service plans to examine an SRS of individual federal income tax returns from each state. One variable of interest is the proportion of returns claiming itemized deductions. The total number of tax returns in a state varies from more than 15 million in California to about 240,000 in Wyoming.
a. Will the margin of error for estimating the population proportion change from state to state if an SRS of 2000 tax returns is selected in each state? Explain your answer.
b. Will the margin of error change from state to state if an SRS of 1% of all tax returns is selected in each state? Explain your answer.