Module 4 Sampling Confidence Interval Estimation 2

Statistics for Managers using
Microsoft Excel
6th Edition

Module 4
Sampling &
Confidence Interval Estimation
Copyright ©2012 Pearson Education

Chap 8-1

Chapter Outline


Confidence Intervals for the Population
Mean, μ







when Population Standard Deviation σ is Known when Population Standard Deviation σ is Unknown

Confidence Intervals for the Population
Proportion, p
Determining the Required Sample Size

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Chap 8-2

Introduction


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Estimation is the process of estimating the value of a parameter from information obtained from a sample.

Chap 8-3

Point and Interval Estimates


A point estimate is a specific numerical value of a parameter.
The best point estimate of the population mean  is the sample mean.

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

An interval estimate of a parameter is an interval or a range of values used to estimate the parameter. This estimate may or may not contain the value of the parameter being estimated. Chap 8-4

Confidence Level and
Confidence Interval
• A 95% confidence level for μ does not mean “the probability that the interval contains μ is 0.95”. The
95% refers to the fraction of intervals, constructed in the long run from many samples of the same size that contains the parameter μ.
• Confidence Interval - An interval estimate for which there is a specified degree of certainty that the actual value of the population parameter will fall within the interval. Copyright ©2012 Pearson Education

Chap 8-5

Point and Interval Estimates


A point estimate is a single number,



a confidence interval provides additional information about the variability of the estimate

Lower
Confidence
Limit

Point Estimate

Upper
Confidence
Limit

Width of confidence interval
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Chap 8-6

Point Estimates

We can estimate a
Population Parameter …

with a Sample
Statistic
(a Point Estimate)

Mean

μ

X

Proportion



p

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