ESTIMATION OF

PARAMETERS
By: Lenolan Diamante
Revised by: Redwaynne Jester T. Ipapo
Objectives
At the end of the discussion, students must be able to:
• illustrate point and interval estimations.
• distinguish between point and interval estimation.
• identify the different properties of a good point estimate
• compute for the point estimate of the population mean
• solve for the standard error of a point estimate.

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DEFINITION OF
Estimator is a statistic that specifies how to use the sample data
to estimate an unknown parameter of the population.

It is used to estimate unknown population parameter such as

true population mean (𝜇), true population proportion (𝑝),
population variance (𝜎 2), etc.

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EXAMP
Here are some situations that exhibits the use of estimation.

• An auto company may want to estimate the mean fuel

consumption of a particular car model.
• A manager may want to estimate the average time taken by
new employees to learn the job.
• PH Census Bureau may want to find the mean housing
expenditure per month incurred by households.
• A polling agency may want to find the proportion of students who
are in favor of our current system in education.
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 Process of
Get a sample Collect info Compute statistic

Retrieved from https://www.snapsurveys.com/blog/hospital- Retrieved from https://bit.ly/3zSKdbU, Sept 9, 2021

surveys-how-to-truly-get-a-random-sample-of-your-patient-
population/, Sept 9, 2021 Retrieved from https://www.callcentrehelper.com/how-to-calculate-schedule-
efficiency-86216.htm , Sept. 9, 2021

However, this is procedure Assign value(s) to the

assumes that the sample corresponding
taken is a simple population
random sample parameter

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TYPES OF

A point estimator gives a single number as an estimate of the unknown

parameter value.

An interval estimator gives a range of possible values as an estimate of

the unknown parameter value.

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 Estimate and Estimator (Example)
Mean Housing Expenditure What can you say about the value of th

ty takes a random sample of 10,000 households and determines the mean housing expenditure per
Define the estimator, estimate, and type of estimate
given the scenarios below:

0
2630 3310
2970

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 Estimate and Estimator
Lower Limit Upper Limit

PhP2630 to PhP3310
=(2970 – 340, 2970 + 340) 2630 3310
= 2970 ± 340 2970

Point
Estimate ± Maximum Error
of the Estimate
Formula for the
confidence
interval

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 DEFINITION OF
A point estimator gives a single number as an estimate of the unknown
parameter value.
Point Estimators
Parameter
µ, population mean
𝜎𝟐, population variance
p, population proportion
Estimator
𝛍ෝ = 𝐗ഥ, sample mean
𝜎෢𝟐 = 𝐒 𝟐 , sample variance
𝐩ෝ = 𝐗Τ𝐧, sample
proportion
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PROPERTIES OF POINT

1. UNBIASEDNESS
A point estimator � is said to be unbiased for the parameter 𝜃 if and
መ
𝜃

� መ
𝜃 መ
𝜃

መ
only if 𝐸 = 𝜃. If the equality does not hold, � is said to be a biased
�
መ
estimator of 𝜃, with =𝐸 − 𝜃.
𝐵

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PROPERTIES OF POINT
Suppose that 𝑋1, 𝑋2, … , 𝑋5 denotes a random sample from some
population with 𝐸 𝑋𝑖 = 𝜇 and 𝑉 𝑋𝑖 = 𝜎 2 , 𝑖 = 1,2, … 5. The following
are suggested as estimators for 𝜇.
𝜇ෞ
1 = 𝑋1
1
𝜇 ෞ3 =
ෞ
2 =

𝜇
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 PROPERTIES OF POINT
(𝑋1 + 𝑋5) (𝑋1 + 2𝑋5)
12 2
𝜇ෞ4 = 𝑋ത
Which estimator would you use and why?

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PROPERTIES OF POINT

Given:
𝜇ෞ1 = 𝑋1

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PROPERTIES OF POINT

𝐸 𝑋𝑖 =𝜇

𝜇ෞ1 = 𝑋1
𝐸(��ෞ1 ) = 𝐸(𝑋1 )

𝐸(��ෞ1 ) = μ

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PROPERTIES OF POINT

Given:
1
𝜇 (𝑋1 + 𝑋5)
ෞ2
2 =

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PROPERTIES OF POINT

Given:
1
𝜇ෞ2 = 1
(𝑋1 + 𝐸 2 = 𝜇+𝜇
𝐸2𝑋𝑖5) ��ෞ
2
𝑋
1
1 =𝜇
𝐸(�� 𝑋1 + 𝑋5 𝐸 2 = 2𝜇
��ෞ

ෞ2 ) 𝐸 2
= 2
𝐸(��ෞ)1 𝐸(��ෞ2 ) = 𝜇
= 𝐸 𝑋1) + 𝐸(𝑋5
2
2
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PROPERTIES OF POINT

Given:
1
𝜇 (𝑋1 + 2𝑋5)
ෞ2
3 =

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PROPERTIES OF POINT

Given:
1 1
𝜇 (𝑋1 + 2𝑋5) 𝐸(�� 𝐸 𝑋1) + 2𝐸(𝑋5
ෞ2 ෞ3 ) 2
3 = =
𝐸 𝑋𝑖 = 𝜇 1
𝐸(��ෞ)1=𝑋1 𝐸 + 2𝑋5 𝐸 ��ෞ3 = 𝜇 + 2𝜇
21
3
2 𝐸 ��ෞ3 = 3𝜇
1 2
𝐸(��ෞ3 ) 𝑋1) + 𝐸(2𝑋5
3
𝐸(��ෞ3 ) = 𝜇
2

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PROPERTIES OF POINT

Given:
𝜇 𝑋ത
ෞ
4 =

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PROPERTIES OF POINT

Given:
𝜇 𝑋ത
ෞ
4 =
ത𝑋
𝐸 ��ෞ 4 =𝐸

𝐸 ��ෞ 4 =𝜇

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PROPERTIES OF POINT

Best Point Estimator is the closest to the mean.

𝐸(��ෞ1 ) = μ

𝐸(��ෞ2 ) = 𝜇

3
𝐸(��ෞ3 ) = 𝜇
2
𝐸 ��ෞ 4 =𝜇
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PROPERTIES OF POINT

2. EFFICIENCY or PRECISION
If Θ෡1 and Θ෡ 2 are two unbiased estimators of the same
population
parameter 𝜃 , we want to choose the estimator whose sampling
distribution has the smaller variance. Hence, if σ2 𝜃෡ < σ2 𝜃෡ , we say
1 2
that Θ෡1 is a more efficient estimator of 𝜃 than Θ෡ 2 .

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PROPERTIES OF POINT
Suppose that 𝑋1, 𝑋2, … , 𝑋5 denotes a random sample from some
population with 𝐸 𝑋𝑖 = 𝜇 and 𝑉 𝑋𝑖 = 𝜎 2 , 𝑖 = 1,2, … 5. The following
are suggested as estimators for 𝜇.
𝜇ෞ
1 = 𝑋1
1
𝜇 ෞ3 =
ෞ
2 =

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 PROPERTIES OF POINT
(𝑋1 + 𝑋5) (𝑋1 + 2𝑋5)
12 2
𝜇ෞ4 = 𝑋ത
Which estimator would you use and why?

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PROPERTIES OF POINT

Given:
𝜇ෞ1 = 𝑋1

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PROPERTIES OF POINT

𝑉 𝑋𝑖 = 𝜎2

𝜇ෞ1 = 𝑋1

𝑉(��ෞ1 ) = 𝑉(𝑋1 )
𝑉(��ෞ1 ) = 𝜎 2

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PROPERTIES OF POINT

Given:
1
𝜇 (𝑋1 + 𝑋5)
ෞ2
2 =

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PROPERTIES OF POINT

Given: 1
1
𝜇 (𝑋1 + 𝑋5) 𝑉 ��ෞ2 = 𝑉 𝑋1) + 𝑉(𝑋5
4 1
ෞ2
��ෞ2 𝜎2 + 𝜎2
2 =
𝑉 𝑋𝑖 = 𝜎2
1 𝑋1 + 𝑋5 𝑉 =
𝑉(��ෞ2 ) = 41
𝑉 𝑉 ��ෞ2 = 2𝜎2
2 4
2 1 2
1 𝑉(��ෞ2 ) =
𝜎
𝑉 ��ෞ2 = 𝑉 𝑋1 + 𝑋5 2
2

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PROPERTIES OF POINT

Given:
𝜇 𝑋ത
ෞ
4 =

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PROPERTIES OF POINT

Given:
𝜇 𝑋ത
ෞ
4 =

𝑉 𝑋𝑖 = 𝜎2
ത𝑋
𝑉 ��ෞ 4 =𝑉
��ෞ 4 𝑉 =
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 PROPERTIES OF POINT
𝜎2
5

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PROPERTIES OF POINT
Note: If 𝝈2 < 𝝈2 , we say that 𝜽1is a more efficient estimator of 𝜽
than 𝜽2. 𝜃 𝜃2
1

𝑉(��ෞ1 ) = 𝜎 2

𝑉(��ෞ2 ) = 1
2
2 𝜎

��ෞ 4 𝑉 =

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 PROPERTIES OF POINT
𝜎2
5

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PROPERTIES OF POINT

An engineer wish to estimate the mean yield of a chemical process

based on the yield measurements (i.e. 𝑋1, 𝑋2, 𝑋3) from three
independent runs of an experiment. Consider the following two
estimators of the mean yield θ, which one should be preferred?

𝜃෢1 𝑋1 + 𝑋2 + 𝑋3
= 3

𝜃෢2 𝑋1 + 2𝑋2 + 𝑋3
=
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PROPERTIES OF POINT
4

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 PROPERTIES OF POINT
Solution: 𝑋 + 2𝑋 + 𝑋
𝑋 +𝑋 +𝑋 𝜃෢ 1 2 3
=
𝜃෢1 = 1 2 3 2
4
3
𝐸(𝜃෢) = 𝐸 𝑋1 + 2𝑋2 + 𝑋3
෢ 𝑋1 + 𝑋2 + 𝑋3 2 4
𝐸(𝜃 1 ) = 𝐸 3 1
1 ෢
𝐸(𝜃 ) = 𝐸
𝑋1 + 2𝑋2 + 𝑋3
𝐸(𝜃෢1 ) 𝐸 𝑋1 + 𝑋2 + 𝑋3 2
4
= 3 1
1 ෢
𝐸(𝜃 ) = [𝐸 ]
𝐸(𝜃෢1 ) [𝐸 𝑋1) + 𝐸(𝑋2) + 𝐸(𝑋3 ] 2 𝑋1) + 𝐸(2𝑋2) + 𝐸(𝑋3
= 4
3 1
𝑋1) + 2𝐸(𝑋2) + 𝐸(𝑋3
𝐸(𝜃෢1 ) 1 𝐸(𝜃෢2 ) [𝐸 ]
(𝜇 + 𝜇 + 𝜇) 4
= 3 = 1
1 ෢
𝐸(𝜃 ) = (𝜇 + 2𝜇 + 𝜇)
𝐸(𝜃෢1 ) = (3𝜇) 2 4 1
𝐸(𝜃෢1 ) 3=𝜇 ෢

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PROPERTIES OF POINT
𝐸(𝜃2) = (4𝜇)
4
𝐸(𝜃෢2 ) = 𝜇

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 PROPERTIES OF POINT
Solution: 𝑋 + 2𝑋 + 𝑋
𝑋 +𝑋 +𝑋 𝜃෢ 1 2 3
=
𝜃෢1 = 1 2 3 2
4
3
𝑉(𝜃෢) = 𝑉 𝑋1 + 2𝑋2 + 𝑋3
𝑋1 + 𝑋2 + 𝑋3 2 4
𝑉(𝜃෢1 ) = 𝑉
3
2
2
1 𝑉(𝜃෢2 ) 1
𝑉(𝜃෢1 ) = 𝑉 𝑋1 + 𝑋2 + 𝑋3 𝑉 𝑋1 + 2𝑋2 + 𝑋3
3 = 4
1
1 𝑉(𝜃෢) = [𝑉 ]
𝑋1) + 𝑉(2𝑋2) + 𝑉(𝑋3
2
𝑉(𝜃෢1 ) [𝑉 𝑋1) + 𝑉(𝑋2) + 𝑉(𝑋3 ] 16
= 1
9 1 𝑉(𝜃෢2 ) [𝑉 𝑋1) + 22𝑉(𝑋2) + 𝑉(𝑋3 ]
=
𝑉(𝜃෢1 ) (𝜎 + 𝜎 + 𝜎 )
2 2 2
16
9 1
= 1 ෢
𝑉(𝜃 2 ) (𝜎2 + 4𝜎2 + 𝜎 2 )
=
𝑉(𝜃෢1 ) =

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(3𝜎 )
2
PROPERTIES
9
OF POINT
1 1
𝑉(𝜃෢1 ) 𝜎 2 ෢
𝑉(𝜃 2 ) 16 (6𝜎 2
)
= 3 =
3 2
෢

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PROPERTIES OF POINT

The number of breakdowns per week for a certain minicomputer is a

random variable 𝑋 having a Poisson distribution with mean 𝜆. A
random sample 𝑋1, 𝑋2, 𝑋3, … , 𝑋𝑛 of observations on the number of
breakdowns per week is available. Find an unbiased estimator of 𝜆.

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PROPERTIES OF POINT

The number of breakdowns per week for a certain minicomputer is a

random variable 𝑋 having a Poisson distribution with mean 𝜆. A
random sample 𝑋1, 𝑋2, 𝑋3, … , 𝑋𝑛 of observations on the number of
breakdowns per week is available. Find an unbiased estimator of 𝜆.

𝜃መ = 𝜆

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PROPERTIES OF POINT
3. RESISTANCE
Indicates minimal influence of outliers. Median is more resistant than
the mean.

An outlier is an observation that lies an abnormal distance from other

values in a random sample from a population.

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PROPERTIES OF POINT

3. RESISTANCE
Indicates minimal influence of outliers. Median is more resistant than
the mean.

Consider a sample consisting of values 2, 4, 5, 6, and 28 from a

population whose mean is 9. Which will be a better estimator, the
mean or median? Can you actually use the median as an estimator of
the mean? Why or why not?

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PROPERTIES OF POINT

4. CONSISTENCY
A sequence of estimators is said to be consistent if it converges in
probability to the true value of the parameter.
So that, lim 𝑃( 𝜃መ − < ε) = 1 or lim 𝑃( 𝜃መ − > ε) = 0
𝑛→∞ 𝑛 𝑛
𝑛→∞

𝑉 𝜃𝑛 →0
𝐸 𝜃𝑛 →𝜃
as
𝑛→∞
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PROPERTIES OF A GOOD
Goal for to have a good point estimator
To accomplish RUMVUE
• R – esistant
• U – niform (or consistent)
• M – inimum
• V –ariance (or efficient)
• U – nbiased
• E - stimator

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POINT
Suppose that random sample of 10 students have the following grades
in MATH 05:
90, 93, 85, 77, 88, 80, 78, 83, 95, 90
a. What is the best point estimator for the true average grade in
mathematics and what is the corresponding estimate?
b. If the population variance of grades in mathematics is 100,
what is the standard error of the point estimate?

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POINT
Suppose that random sample of 10 students have the following grades
in MATH 05:
90, 93, 85, 77, 88, 80, 78, 83, 95, 90
a. What is the best point estimator for the true average grade in
mathematics and what is the corresponding estimate?

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 POINT
Suppose that random sample of 10 students have the following grades in
MATH 05:
90, 93, 85, 77, 88, 80, 78, 83, 95, 90
a. What is the best point estimator for the true average grade in
mathematics and what is the corresponding estimate?

𝑋ത10 10 90 + 93 + 85 + 77 + 88 + 80 + 78 + 83 + 95 + 90
= σ 𝑋
𝑖= 𝑖 =
𝑛 10
ത 859 = 85.9
𝑋 10 =
10
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POINT
Suppose that random sample of 10 students have the following grades
in MATH 05:
90, 93, 85, 77, 88, 80, 78, 83, 95, 90
b. If the population variance of grades in mathematics is 100,
what is the standard error of the point estimate?

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POINT
Suppose that random sample of 10 students have the following grades
in MATH 05:
90, 93, 85, 77, 88, 80, 78, 83, 95, 90
b. If the population variance of grades in mathematics is 100,
what is the standard error of the point estimate?
𝜎
𝑆𝑡𝑎𝑛𝑑𝑎𝑟𝑑 𝑒𝑟𝑟𝑜𝑟 =
10 𝑛
=
10

= 3.16 shs.mapua.edu.ph
POINT
Suppose the following data shows the number of the problems from
the Practice Problems Set attempted in the past week by 10 randomly
selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
a. Find the sample mean.
b. Find the sample variance.
c. Estimate the mean number of practice problems attempted
by a student in the past week.
d. Estimate the standard error of the estimated mean.
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POINT
Suppose the following data shows the number of the problems from
the Practice Problems Set attempted in the past week by 10 randomly
selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
a. Find the sample mean.

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POINT
Suppose the following data shows the number of the problems from
the Practice Problems Set attempted in the past week by 10 randomly
selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
a. Find the sample mean.

𝑋ത10 = σ10 𝑋 = 2 + 4 + 0 + 7 + 1 + 2 + 0 + 3 + 2 + 1
𝑖= 𝑖
10
𝑛
𝑋ത10 = 2.2

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 POINT
Suppose the following data shows the number of the problems from the Practice
Problems Set attempted in the past week by 10 randomly selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
b. Find the sample variance.

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 POINT
Suppose the following data shows the number of the problems from the Practice
Problems Set attempted in the past week by 10 randomly selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
b. Find the
ത 2
sample variance.
σ10 𝑥𝑖 − 𝑋 2
3 2 − 2.2 2
+ 4 − 2.2 2 2
+ 2 0 − 2.2 2
+ 7 − 2.2 2
+ 2 1 − 2.2 + 3 − 2.2
𝑠2 = 𝑖=1
𝑛−1 = 10 − 1
2
39.6 = 4.4
𝑠 = 9

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POINT
Suppose the following data shows the number of the problems from
the Practice Problems Set attempted in the past week by 10 randomly
selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
c. Estimate the mean number of practice problems attempted
by a student in the past week.
𝑋ത = 𝜇 = 2.2

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POINT
Suppose the following data shows the number of the problems from
the Practice Problems Set attempted in the past week by 10 randomly
selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
d. Estimate the standard error of the estimated mean.

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POINT
Suppose the following data shows the number of the problems from
the Practice Problems Set attempted in the past week by 10 randomly
selected students:
2, 4, 0, 7, 1, 2, 0, 3, 2, 1
d. Estimate the standard error of the estimated mean.
𝑠
𝑆𝑡𝑎𝑛𝑑𝑎𝑟𝑑 𝑒𝑟𝑟𝑜𝑟 =
𝑛
4.4
=
10
= 0.66
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POINT
A survey is conducted to determine the opinions of people on global
warming. In a random sample of 150 people, 108 think that global
warming is a serious world problem.
a. Estimate the proportion of adults who think that global
warming is a very serious world problem.
b. Estimate the proportion of adults who think that global
warming is not a very serious world problem.
c. What is the standard error of this estimate?

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POINT
A survey is conducted to determine the opinions of people on global
warming. In a random sample of 150 people, 108 think that global
warming is a serious world problem.
a. Estimate the proportion of adults who think that global
warming is a very serious world problem.

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POINT
A survey is conducted to determine the opinions of people on global
warming. In a random sample of 150 people, 108 think that global
warming is a serious world problem.
a. Estimate the proportion of adults who think that global
warming is a very serious world problem.
𝑥
𝑝=
𝑛
108
𝑝= = 0.72
150

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POINT
A survey is conducted to determine the opinions of people on global
warming. In a random sample of 150 people, 108 think that global
warming is a serious world problem.
b. Estimate the proportion of adults who think that global
warming is not a very serious world problem.

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POINT
A survey is conducted to determine the opinions of people on global
warming. In a random sample of 150 people, 108 think that global
warming is a serious world problem.
b. Estimate the proportion of adults who think that global
warming is not a very serious world problem.
𝑞ො = 1 − 𝑝
𝑞ො = 1 108
− 150
42

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POINT
𝑞ො = = 0.28
150

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POINT
A survey is conducted to determine the opinions of people on global
warming. In a random sample of 150 people, 108 think that global
warming is a serious world problem.
c. What is the standard error of this estimate?

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POINT
A survey is conducted to determine the opinions of people on global
warming. In a random sample of 150 people, 108 think that global
warming is a serious world problem.
c. What is the standard error of this estimate?
𝑝Ƹ�
�ො
𝑝𝑞
𝑆𝑡𝑎𝑛𝑑𝑎𝑟𝑑 𝑒𝑟𝑟𝑜𝑟 = =𝑛
𝑛
0.72(0.28)
= 150 = 0.037

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End of Presentation