MARKETING RESEARCH

ESSENTIALS
WITH DATA ANALYSIS IN EXCEL AND SPAA
McDaniel │ Gates │ Sivaramakrishnan │ Main

Chapter Twelve:
Sample Size Determination
 LEARNING OBJECTIVES
Chapter Twelve: Sample Size Determination

• Understand the financial and statistical issues in the

determination of sample size and explore methods for
determining sample size
• Understand what a normal distribution is
• Understand population, sample, and sampling
distributions
• Distinguish between point and interval estimates
• Recognize problems involving sampling means and
proportions
• Understand Type I and Type II errors in statistical
conclusions
 Sample Size for Probability Samples

• Budget available for survey study

• Use of “rule of thumb”

• Number of subgroups to be analyzed

• Application of traditional statistical methods

 Normal Distribution

• Central Limit Theorem:

– A distribution of a large number of sample means or sample
proportions will approximate a normal distribution, regardless of
the distribution of the population from which they were drawn

• Normal Distribution:
– The continuous distribution that is bell shaped and symmetrical
about the mean
– The mean, median, and mode are equal
 Normal Distribution

• Proportionate Properties:
– The number of observations falling between the mean and a given
number of standard deviations from the mean is the same for all
normal distributions

• Standard Normal Distribution:

– Normal distribution with a mean of zero and a standard deviation
of one
 Normal Distribution
• Standard Deviation:
Measure of dispersion calculated by:
1. Subtracting the mean of the series from each value in a series
2. Squaring each result
3. Summing the results
4. Dividing the sum by the number of observations minus 1,
and taking the square root of this value

2
(X
(X1-1-X)
sum

2
Standard X)
==
sum

Standard
Deviation
Deviation (N-1)
(N-1)
Population and Sampling Distributions

• Population Distributions:
– Frequency distribution of all the elements of population

• Sampling Distributions:
– Frequency distribution of all elements of an individual sample

• Sampling Distribution of the Mean:

– Theoretical frequency distribution of the means of all possible
samples of a given size drawn from a population
– It is normally distributed.

• Standard Error of the Mean:

– Standard deviation of a distribution of sample means
 Point and Interval Estimates

• Point Estimate:
– Estimate of a population value

• Interval Estimate:
– Interval or range of values within which the true population value
is estimated to fall

• Confidence Level:
– The probability that a particular interval will include the true
population value

• Confidence Interval:
– The interval that, at the specified confidence level, includes the
true population value
Sampling Distribution of the Proportion

• Sampling Distribution of the Proportion:

– Relative frequency distribution of the sample proportions of many
random samples of a given size drawn from a particular
population
– It is normally distributed
 Determining Sample Size

• Problems involving means:

 Determining Sample Size

• Problems involving proportions:

 Statistical Power

• Probability of not making a type II error

• Type I Error:
– The error of concluding something that doesn’t exist
– E.g., concluding that there is a difference in the responses of 2
groups when there is no difference
• Type II Error:
– The failure to conclude something when it indeed exists
– E.g., concluding there is no difference in the responses of the two
groups when there is a difference
 Key Sampling Considerations

• Time to generate sample

• Scope of the research
• Budget available
• Experience with sampling
• Level of accuracy desired
• Your knowledge of the population
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