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10/15/2015

OPRE 6301/SYSM 6303


Quantitative Introduction to Risk and
Uncertainty in Business
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Chapter Nine
Sampling Distributions

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Statistical Inference
Converts data to information

We can estimate population parameters by


collecting sample data and calculating the
corresponding sample statistics.
We expect our estimates to be close,
but how close?

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Sampling Distribution
of the Mean
Lets investigate the throwing of a fair die
Let x = the # of spots on one throw

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Sampling Distribution
of the Mean
Lets now investigate the throwing of two fair dice

For each die, we note the value of x.


We will also calculate x .

This is equivalent to sampling from the same


distribution of x two time i.e. n=2.
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Sampling Distribution
of the Mean
We can now create a distribution of x.

We call this
the sampling distribution of

x.
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Sampling Distribution
of the Mean
We can calculate the parameters of the
distribution of x .

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Sampling Distribution
of the Mean
Compare the distribution of x

with the distribution of x .


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Sampling Distribution
of the Mean
Note also that

x

2
x

2
n

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Sampling Distribution
of the Mean
Lets investigate how the sampling distribution
of the mean changes as we
increase the sample size, n.

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n=5

n=10

n=25
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Sampling Distribution
of the Mean
These relationships define the
sampling distribution of x .

x

2
x

2
n

We refer to this as the


standard error

n
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Central Limit Theorem


The sampling distribution of the mean of a
random sample drawn from any population is
approximately normal for a sufficiently large
sample size.
The larger the sample size, the more closely the
sampling distribution of x will resemble a normal
distribution.
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Sampling Distribution
of the Mean
Lets look at Example 9.1

The foreman of a bottling plant has observed that


the amount of soda in each 32-ounce bottle is
actually a normally distributed random variable
with a mean of 32.2 ounces and a standard
deviation of 0.3 ounces.

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Sampling Distribution
of the Mean
If a customer buys one bottle, what is the
probability that the bottle
will contain more than 32 ounces?

P X 32 ?

32.2

0.3

X 32 32.2
P X 32 P

0.3

P Z 0.67
1 P Z 0.67 1 0.2514 0.7486
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Sampling Distribution
of the Mean
If a customer buys a carton of four bottles, what is
the probability that the mean amount of the four
bottles will be greater than 32 ounces?
0.3
x 32.2
x
0.15
P X 32 ?
4
X x 32 32.2

P X 32 P

0.15
x
P Z 1.33
1 P Z 1.33 1 0.0918 0.9082
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Sampling Distribution
of the Mean

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Sampling Distribution
of the Sample Proportion
Lets define the sample proportion of a
population to be the number of successes in a
sample of n.

X
P
n

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Sampling Distribution
of the Sample Proportion
P is approximately normally distributed provided
np and n(1-p) are greater than or equal to 0.5.

E P p
p1 p
V P p2
n

p p1 p n

We refer to this as the


standard error of the
proportion

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Sampling Distribution
of the Sample Proportion
Lets investigate Example 9.2

In the last election, a state representative


received 52% of the votes cast.
One year after the election, the representative
organized a survey that asked a random sample
of 300 people whether they would vote for him in
the next election.
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Sampling Distribution
of the Sample Proportion
If we assume that his popularity has not changed,
what is the probability that more than half of the
sample would vote for him?

P P 0.50 ?

n 300

p 0.52

P p
0.50 0.52
P P 0.50 P

p1 p n
.0288

P Z 0.69
1 P Z 0.69 1 0.2451 0.7549

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Statistical Inference

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