Interval Estimate of a Population Mean: t Distribution

s Unknown
 If an estimate of the population standard deviation s A t distribution with more degrees of freedom has
cannot be developed prior to sampling, we use the less dispersion.
sample standard deviation s to estimate s .
 This is the s unknown case. As the degrees of freedom increases, the difference
between the t distribution and the standard
 In this case, the interval estimate for m is based on the
normal probability distribution becomes smaller
t distribution.
and smaller.
 (We’ll assume for now that the population is
normally distributed.)

21 22

t Distribution t Distribution

For more than 100 degrees of freedom, the standard

t distribution normal z value provides a good approximation to
Standard (20 degrees the t value.
normal of freedom)
distribution
The standard normal z values can be found in the
infinite degrees ( ) row of the t distribution table.
t distribution
(10 degrees
of freedom)

z, t
0

23 24

t Distribution Interval Estimate of a Population Mean:

s Unknown
 Interval Estimate
s
x  t /2
n
where: 1 - = the confidence coefficient
t/2 = the t value providing an area of /2
in the upper tail of a t distribution
with n - 1 degrees of freedom
s = the sample standard deviation
Standard normal
z values

25 26

1
 Interval Estimate of a Population Mean: Interval Estimate of a Population Mean:
s Unknown s Unknown
 Example: Apartment Rents At 95% confidence,  = .05, and /2 = .025.
A reporter for a student newspaper is writing an t.025 is based on n - 1 = 16 - 1 = 15 degrees of freedom.
article on the cost of off-campus housing. A sample of In the t distribution table we see that t.025 = 2.131.
16 one-bedroom apartments within a half-mile of
campus resulted in a sample mean of $750 per month
and a sample standard deviation of $55.
Let us provide a 95% confidence interval estimate
of the mean rent per month for the population of one-
bedroom efficiency apartments within a half-mile of
campus. We will assume this population to be
normally distributed.

27 28

Interval Estimate of a Population Mean: Interval Estimate of a Population Mean:

s Unknown s Unknown
 Interval Estimate  Adequate Sample Size
s
x  t.025 Margin In most applications, a sample size of n = 30 is
n of Error adequate when using the expression 𝑥̅ ± 𝑡 ⁄ 𝑠⁄ 𝑛 to
55 develop an interval estimate of a population mean.
750  2.131  750  29.30
16 If the population distribution is highly skewed or
contains outliers, a sample size of 50 or more is
We are 95% confident that the mean rent per month
recommended.
for the population of one-bedroom apartments within
a half-mile of campus is between $720.70 and $779.30.

27

29 30

Interval Estimate of a Population Mean: Summary of Interval Estimation Procedures

s Unknown for a Population Mean
 Adequate Sample Size (continued)
Can the
Yes No
If the population is not normally distributed but is population standard
roughly symmetric, a sample size as small as 15 deviation s be assumed
will suffice. known ?
Use the sample
If the population is believed to be at least standard deviation
approximately normal, a sample size of less than 15 s Known s to estimate s
can be used. Case
Use Use
s s Unknown s
x  z /2 Case x  t /2
n n
With n-1 dof

31 32

2
 Sample Size for an Interval Estimate Sample Size for an Interval Estimate
of a Population Mean of a Population Mean
 Margin of Error
Let E = the desired margin of error.
s
E is the amount added to and subtracted from the E  z /2
n
point estimate to obtain an interval estimate.

If a desired margin of error is selected prior to  Necessary Sample Size

sampling, the sample size necessary to satisfy the
margin of error can be determined. ( z / 2 ) 2 s 2
n
E2

33 34

Sample Size for an Interval Estimate
of a Population Mean
 Example: Apple India
The Necessary Sample Size equation requires a
value for the population standard deviation s .
If s is unknown, a preliminary or planning value
for s can be used in the equation.
1. Use the estimate of the population standard
deviation computed in a previous study.
2. Use a pilot study to select a preliminary study and
use the sample standard deviation from the study.
3. Use judgment or a “best guess” for the value of s .
Sample Size for an Interval Estimate
of a Population Mean
Recall that Apple India is evaluating a
potential location for a new retail outlet, based in
part, on the mean annual income of the individuals in
the marketing area of the new location.
Suppose that Apple India’s management team
wants an estimate of the population mean such that
there is a .95 probability that the sampling error is
Rs 500 or less.
How large a sample size is needed to meet the
required precision?

35 36

Sample Size for an Interval Estimate Interval Estimate

of a Population Mean of a Population Proportion
s The general form of an interval estimate of a
z /2  500
n population proportion is
At 95% confidence, z.025 = 1.96. Recall that s= 4,500. p  Margin of Error
(1.96)2 (4, 500)2
n  311.17  312
(500)2

A sample of size 312 is needed to reach a desired

precision of + $500 at 95% confidence.

37 38

3
 Interval Estimate Interval Estimate
of a Population Proportion of a Population Proportion
 Normal Approximation of Sampling Distribution of p
The sampling distribution of plays a key role in
computing the margin of error for this interval
estimate. Sampling p(1 - p )
distribution sp 
of p n
The sampling distribution of can be approximated
by a normal distribution whenever np > 5 and
n(1 – p) > 5. /2 1 -  of all /2
p values
p
p
z /2s p z /2s p

39 40

Interval Estimate Interval Estimate

of a Population Proportion of a Population Proportion
 Interval Estimate  Example: Political Science, Inc.
Political Science, Inc. (PSI) specializes in voter polls
p (1 - p ) and surveys designed to keep political office seekers
p  z / 2
n
informed of their position in a race.
Using telephone surveys, PSI interviewers ask
where: 1 - is the confidence coefficient
registered voters who they would vote for if the
z/2 is the z value providing an area of
election were held that day.
/2 in the upper tail of the standard
normal probability distribution
p is the sample proportion

41 42

Interval Estimate Interval Estimate

of a Population Proportion of a Population Proportion
 Example: Political Science, Inc.
p (1 - p )
In a current election campaign, PSI has just found p  z / 2
n
that 220 registered voters, out of 500 contacted, favor
a particular candidate. PSI wants to develop a 95% where: n = 500, p = 220/500 = .44, z/2 = 1.96
confidence interval estimate for the proportion of the .44(1 - .44)
population of registered voters that favor the .44  1.96 = .44 + .0435
500
candidate.
PSI is 95% confident that the proportion of all voters
that favor the candidate is between .3965 and .4835.

43 44

4
 Sample Size for an Interval Estimate Sample Size for an Interval Estimate
of a Population Proportion of a Population Proportion
 Margin of Error  Necessary Sample Size

p (1 - p ) ( z / 2 ) 2 p* (1 - p* )
E  z / 2 n
n E2

Solving for the necessary sample size, we get The planning value p* can be chosen by:
( z )2 p(1 - p ) 1. Using the sample proportion from a previous
n   /2 2 sample of the same or similar units, or
E
However, p will not be known until after we have 2. Selecting a preliminary sample and using the
selected the sample. We will use the planning value sample proportion from this sample.
p* for p. 3. Use judgment or a “best guess” for a p* value.
4. Otherwise, use .50 as the p* value.

45 46

Sample Size for an Interval Estimate Sample Size for an Interval Estimate
of a Population Proportion of a Population Proportion
 Example: Political Science, Inc.
p * (1 - p * )
Suppose that PSI would like a .99 probability that z /2  .03
n
the sample proportion is within ± .03 of the
At 99% confidence, z.005 = 2.576. Recall that p* = .44.
population proportion.
How large a sample size is needed to meet the ( z /2 )2 p* (1 - p* ) (2.576)2 (.44)(.56)
n 2
  1817
required precision? (A previous sample of similar E (.03)2
units yielded .44 for the sample proportion.)
A sample of size 1817 is needed to reach a desired
precision of + .03 at 99% confidence.

47 48

Sample Size for an Interval Estimate

of a Population Proportion

Note: We used .44 as the best estimate of p in the

preceding expression. If no information is available
about p, then .5 is often assumed because it provides
the highest possible sample size. If we had used
p = .5, the recommended n would have been 1843.

49