Estimation

A statistic is called an unbiased estimator of a population parameter if the mean or

expectation of the statistic is equal to the parameter.

An estimate of a population parameter given by a single number is called a point estimate

of the parameter. An estimate of a population parameter given by two numbers between
which the parameter may be considered to lie is called an interval estimate of the
parameter.

Confidence Intervals for Means

Let S be a statistic in a population, S  1.96 s , S  2.58 s , are 95% and 99% confidence
limits for  s . The percentage confidence is often called the confidence level. The numbers
1.96, 2.58, etc., in the confidence limits are called confidence coefficients or critical
values and are denoted by z.

1. Large samples (n  30)

___
If the statistic is the sample mean X , then the confidence interval is
___

X z c
n
(with replacement)

Then the 95% and 99% confidence limits for estimation of the population mean 
___ ___
are given by X  1.96 x and X  2.58 x , respectively

If the sampling is without replacement from a population of finite size, N, the

confidence interval for the population mean is

___
 N n
X z c
n N 1
(without replacement)

Examples

1. Find a 95% confidence interval for a population mean  for n = 36,

__
x  15.2, s 2  2.56 or s = 1.6

Solution:

__
Since the sample size of n=36 is large, the distribution of the sample mean x is
 
approximately normally distributed with mean  and standard error . The
n
approximate 95% confidence interval is

__
 s 
x  1.96 
 n
 1.6 
15.2  1.96 
 36 
15.2  1.96(0.267)
15.2  0.52

14.68 - 15.72

2. In a survey it was found that the average daily intake of coffee of 4000 adults, selected
a random sample of n=80, was 745 grams per day with standard deviation of s=40 grams
per day. Construct a 99% confidence interval for the mean.

Solution:

The standard unit for 0.99 is z=2.58. The 99% confidence interval is then

__
 s 
x  2.58 
 n
 40 
745  2.58 
 80 

745  2.58( 4.47 )

745  11.54

733.46  756.54

2. Small samples (n <30)

In this case, we use the t-distribution to obtain the confidence level

___

X  tc
n 1

Examples

1. A sample of 10 measurement of the length of a chip gave a mean x= 2.36cm and a

standard deviation s=0.06cm. Find a) 95%, b) 99% confidence limits.

Solution
A. For 95% confidence coefficients (two-tailed) the total shaded area in the figure must
be 0.05

*insert figure*

Thus the shaded area in the right tail is 0.025 and the corresponding critical value is
t0.025 .

The degree of freedom df= n-1 = 10-1= 9. The required confidence interval is 2.26 (see
table 2). Then using x=2.36 and s=0.06, the required 95% confidence limits are

__
 s 
x  t0.025  
 n 1 
 0.06 
2.36 2.26  
 10  1 
2.36  0.0452
2.3148  2.4052

B. For 99% confidence coefficients (two-tailed) the total shaded area in the figure must
be 0.01. The shaded area in the right tail is 0.005 and the corresponding value is t0.005 .
The degree of freedom df= n-1 = 10-1 = 9. The required coefficient is 3.25 (see Table 2).
The required confidence limits are

__
 s 
x  t0.005  
 n 1 
 0.06 
2.36 3.25  
 10  1 
2.36  3.25(0.02)
2.36  0.065
2.2951  2.425

Confidence Intervals for Proportions

The confidence limits for the population proportion are given by

pq
P  zc (with replacement)
n

In cse sampling is from an infinite population or if sampling is with replacement from a

finite population.

If sampling is without replacement from a population of finite sizes N, the confidence

limits are

pq N n
P  zc (without replacement)
n N 1

Examples

1. A random sample of n = 400 observations from a binomial population produced x =

248 successes. Find a 95% confidence interval for p.

Solution:

The point estimate for p is

x 248
p   0.62
n 400

And the standard error is

pq (.62)(.38)
SE    0.024
n 400


The z-value for 95% confidence interval is the value that has area  0.025 or
2
z0.025  1.96 . The 95% confidence interval for p is

p  1.96 SE
0.62  (1.96)( 0.024)
0.62  0.047
0.572  0.667

2. A random sample of 1000 voters- those who are likely to vote in the upcoming
presidential election in 2010. Of those surveyed, 695 indicaed that they intend to vote
for a candidate with integrity. Construct a 90% confidence interval for p.

Solution

The point estimate for p is

x 695
p   0.695
n 1000

And the standard error is

 pq (.695)(.305)
SE    0.015
n 1000


The z-value for 90% confidence interval is the value that has area  0.05 or
2
z0.05  1.645 . The 90% confidence interval for p is

p  1.645 SE
0.695  (1.645)( 0.015)
0.695  0.024
0.671  0.719

Confidence Intervals for Differences

The confidence limits for the difference of two population means, where the populations
are infinite, are given by

 12  22
X 1  X 2  zc x1  x2  X 1  X 2  zc 
n1 n2

Similarly, confidence limits for the difference of two population proportions, where
populations are infinite, are given by

p1 (1  p1 ) p2 (1  p2 )
P1  P2  zc P1  P2  P1  P2  zc 
n1 n2

Examples

1. A sample of 100 brand A cellphone battery showed a mean life of 1500 hours and a
standard deviation of 115 hours. A sample of 200 brand B cellphone battery showed a
mean life of 1200 hours and a standard deviation of 110 hours. Find a 95% confidence
limits for the difference of the mean lifetimes of the populations of brands A and B.

Solution:

Confidence limits for the difference in means of brand A and B are given by

The 95% confidence limits are

1152 110 2
1500  1200  1.96 
100 200
300  (1.96)(13.883)
300  27.21
272.79  327.21
2. In a random sample of 400 female and 600 male college students who frequent internet
cafes, 100 female and 300 male college students indicated they like playing internet
games. Construct a 99% confidence limits for the difference in proportions of all female
and male college students who frequent internet cafes.

Solution:

Confidence limits for the difference in proportions of the two groups are given by

p1 (1  p1 ) p2 (1  p2 )
P1  P2  zc P1  P2  P1  P2  zc 
n1 n2

Where subscript 1 and 2 refer to female and male students respectively.

x1 100 x 300
Here P1    0.25 and P2  2   0.50
n1 400 n2 600

The 99% confidence limits are:

(0.50)(0.50) (0.25)(0.75)
0.50  0.25  2.58 
600 400
0.25  (2.58)(0.03)
0.25  0.077
0.173  0.327