1.

Classical method of Estimation

1.1 Point of Estimator - a point estimate of a population parameter is a single value of a statistic.
For Example:

A.) THE SAMPLE STANDARD DEVIATION (S) IS A POINT ESTIMATE OF THE POPULATION STANDARD
DEVIATION (Σ).

Problem for A (Airborne times for Flights from San Francisco to Washington, D.C.)

Formula: The standard deviation of a sample is known as S and is calculated using:

Where x represents each value in the population, x is the mean value of the sample, Σ is the summation
(or total), and n-1 is the number of values in the sample minus 1.

The standard deviation of the problem A is s = 9.14 minutes

B.) THE SAMPLE MEAN (̄X) IS A POINT ESTIMATE OF THE POPULATION MEAN, Μ

Problem for B (Academic Reading)

𝛴𝑥𝑖
Get the mean: ẋ =
𝑛
 ẋ = 14.36
C.) POINT ESTIMATE FOR POPULATION PROPORTION (THE PERCENT)

Problem for C (A survey conducted to estimate the number of college students who used Internet
more than 3 hours a day):

One of the purposes of the survey was to estimate the proportion of college students who spend
more than 3 hours a day of Internet. Based on the information given in the paper, 2998 of 7421 students
surveyed reported Internet use of more than 3 hours per day. We can use this information to estimate
p, where p is the proportion of all Filipino students who use internet more than 3 hrs per day. With a
success identified as a student who uses the Internet more than 3 hrs a day, p is then the population
proportion of success. The statistic:
𝑋
ṕ=𝑛 where X is the number of success in the sample, n is the sample size.

which is the sample proportion of successes, is an obvious choice for obtaining a point estimate of p.
Based on the reported information , the point estimate of p is
2998
ṕ = 7421 ṕ = 40.4%

1.2 Interval estimator - An interval estimate is defined by two numbers, between which a population
parameter is said to lie. For example, a < x < b is an interval estimate of the population mean μ. It
indicates that the population mean is greater than a but less than b.

Examples:

A.) SAMPLING SIZE OF POPULATION PROPORTION

Problem: The EPA considers indoor radon levels above 4 picocuries per liter (pCi/L) of air to be
high enough to warrant amelioration efforts. Tests in a sample of 200 Centre County
Pennsylvania homes found 127 (63.5%) of these sampled households to have indoor radon levels
above 4 pCi/L. What is the population value being estimated by this sample percentage? What is
the standard error of the corresponding sample proportion?

Solution: The population value is the percentage of all Centre County homes with indoor radon
levels above 4 pCi/L.

The standard error of the sample proportion =

0.635 (1−0.635)
√ =0.034
200

Recap: the estimated percent of Centre Country households that don't meet the EPA guidelines
is 63.5% with a standard error of 3.4%. The Normal approximation tells us that
  for 68% of all possible samples, the sample proportion will be within one standard error
of the true population proportion and
 for 95% of all possible samples, the sample proportion will be within two standard errors
of the true population proportion.

Thus, a 68% confidence interval for the percent of all Centre Country households that don't meet
the EPA guidelines is given by

63.5% ± 3.4%.

A 95% confidence interval for the percent of all Centre Country households that don't meet the
EPA guidelines is given by

63.5% ± 6.8%.

Note: when you see a margin of error in a news report, it it almost always referring to a 95%
confidence interval. But other levels of confidence are possible.

B. FOR POPULATION MEAN

Problem
Over the three-day period from April 1 to April 3, 2015, a national poll surveyed 1500 American
households to gauge their levels of discretionary spending. The question asked was how much the
respondent spent the day before; not counting the purchase of a home, motor vehicle, or normal
household bills. For these sampled households, the average amount spent was x¯ = $95 with a standard
deviation of s = $185.

How close will the sample average come to the population mean? Let's follow the same reasoning
as developed in section 10.2 for proportions. We have:

Sample average=population mean+random error

The Normal Approximation tells us that the distribution of these random errors over all possible
samples follows the normal curve with a standard deviation of σn√. Notice how the formula for
the standard deviation of the average depends on the true population standard deviation σ. When
the population standard deviation is unknown, like in this example, we can still get a good
approximation by plugging in the sample standard deviation (s). We call the resulting estimate the
Standard Error of the Mean (SEM).

Standard Error of the Mean (SEM) = estimated standard deviation of the sample average =

𝑠𝑡𝑎𝑛𝑑𝑎𝑟𝑑 𝑑𝑒𝑣𝑖𝑎𝑡𝑖𝑜𝑛 𝑜𝑓 𝑡ℎ𝑒 𝑠𝑎𝑚𝑝𝑙𝑒 𝑠

=
√𝑛 √𝑛
In the example, we have s = $185 so the Standard Error of the Mean =

$185
= $ 4.78
√1500

Recap: the estimated daily amount of discretionary spending amongst American households at the
beginning of April, 2015 was $95 with a standard error of $4.78

The Normal Approximation tells us, for example, that for 95% of all large samples, the sample
average will be within two SEM of the true population average.

Thus, a 95% confidence interval for the true daily discretionary spending would be $95 ± 2($4.78)
or $95 ± $9.56.

Of course, other levels of confidence are possible. When the sample size is large, s will be a good
estimate of σ and you can use multiplier numbers from the normal curve. When the sample size
is smaller (say n < 30), then s will be fairly different from σ for some samples - and that means
that we we need a bigger multiplier number to account for that.

C. THE DIFFERENCE BETWEEN TWO POPULATION PROPORTIONS OR MEANS

Problem

A medical researcher conjectures that smoking can result in wrinkled skin around the eyes. The
researcher recruited 150 smokers and 250 nonsmokers to take part in an observational study and
found that 95 of the smokers and 105 of the nonsmokers were seen to have prominent wrinkles
around the eyes (based on a standardized wrinkle score administered by a person who did not know
if the subject smoked or not). Some results from the study are found in Table 10.2.

Table 10.2. Results of the Smoking and wrinkles study (example 10.6)
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2. Estimating a Population Parameter

Population parameter – a measure of an attribute of a population

EXAMPLES

A.) POPULATION MEAN (number of Law students in Carlos University, Le Paz University,
ST University who are a full time students)

Given: Total population of Law students from 3 Universities = 1000

Full time students: CU = 100

LPU = 90

STU = 125

What is the population mean?

𝒔𝒖𝒎 𝒐𝒇 𝒂 𝒄𝒆𝒓𝒕𝒂𝒊𝒏 𝒂𝒕𝒕𝒓𝒊𝒃𝒖𝒕𝒆 𝒐𝒇 𝒑𝒐𝒑𝒖𝒍𝒂𝒕𝒊𝒐𝒏

Solution: μ = 𝒑𝒐𝒑𝒖𝒍𝒂𝒕𝒊𝒐𝒏 𝒔𝒊𝒛𝒆

= 315/1000

= 3. 17
B.) Population Standard Deviation

σ = ([Σ(x - u)2]/N)1/2

Where:

 σ is the population standard deviation

 Σ represents the sum or total from 1 to N
 x is an individual value

 u is the average of the population

 N is the total number of the population

Example Problem

You grow 20 crystals from a solution and measure the length of each crystal in millimeters. Here
is your data:

9, 2, 5, 4, 12, 7, 8, 11, 9, 3, 7, 4, 12, 5, 4, 10, 9, 6, 9, 4

Calculate the population standard deviation of the length of the crystals.

Calculate the mean of the data. Add up all the numbers and divide by the total number of data
points.

(9+2+5+4+12+7+8+11+9+3+7+4+12+5+4+10+9+6+9+4) / 20 = 140/20 = 7

Subtract the mean from each data point (or the other way around, if you prefer... you will be
squaring this number, so it does not matter if it is positive or negative).

(9 - 7)2 = (2)2 = 4

(2 - 7)2 = (-5)2 = 25

(5 - 7)2 = (-2)2 = 4

(4 - 7)2 = (-3)2 = 9

(12 - 7)2 = (5)2 = 25

(7 - 7)2 = (0)2 = 0

(8 - 7)2 = (1)2 = 1

(11 - 7)2 = (4)22 = 16

 (9 - 7)2 = (2)2 = 4

(3 - 7)2 = (-4)22 = 16

(7 - 7)2 = (0)2 = 0

(4 - 7)2 = (-3)2 = 9

(12 - 7)2 = (5)2 = 25

(5 - 7)2 = (-2)2 = 4

(4 - 7)2 = (-3)2 = 9

(10 - 7)2 = (3)2 = 9

(9 - 7)2 = (2)2 = 4

(6 - 7)2 = (-1)2 = 1

(9 - 7)2 = (2)2 = 4

(4 - 7)2 = (-3)22 = 9

Calculate the mean of the squared differences.

(4+25+4+9+25+0+1+16+4+16+0+9+25+4+9+9+4+1+4+9) / 20 = 178/20 = 8.9

This value is the variance. The variance is 8.9

The population standard deviation is the square root of the variance. Use a calculator to obtain
this number.

(8.9)1/2 = 2.983

The population standard deviation is 2.983

C.) POPULATION VARIANCE

σ2
Sample question: Find the population variance of the age of children in a family of five children
aged 16, 11, 9, 8, and 1:

Step 1: Find the mean, μx:

μ = 9.

Step 2: Subtract each data point from the mean, then square the result:

(16-9)2 = 49

(11-9)2 = 4

(9-9)2 = 0

(8-9)2 = 1

(1-9)2 = 64.

Step 3: Add up all of the squared differences from Step 2:

(16-9)2 + (11-9)2 + (9-9)2 + (8-9)2+ (1-9)2 = 118.

Step 4: Divide Step 3 by the number of items. 118/5 gives a population variance of 23.6.

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3. Determining Sample Size

A sample size is a part of the population chosen for a survey or experiment. For example, you
might take a survey of dog owner’s brand preferences. You won’t want to survey all the millions
of dog owners in the country (either because it’s too expensive or time consuming), so you take a
sample size. That may be several thousand owners. The sample size is a representation of all dog
owner’s brand preferences. If you choose your sample wisely, it will be a good representation.

EXAMPLES:

A.) Modification for the Cochran Formula for Sample Size Calculation In Smaller
Populations

If the population we’re studying is small, we can modify the sample size we calculated in the
above formula by using this equation:
Here n0 is Cochran’s sample size recommendation, N is the population size, and n is the new,
adjusted sample size. In our earlier example, if there were just 1000 households in the target
population, we would calculate

385 / (1+( 384 / 1000 )) = 278

So for this smaller population, all we need are 278 households in our sample; a substantially
smaller sample size.

B.) How to Find a Sample Size Given a Confidence Interval and Width (unknown
population standard deviation)

Part two shows you how to find a sample size for a given confidence interval and width (e.g.
95% interval, 6% wide) for an unknown population standard deviation.

Sample question: 41% of Jacksonville residents said that they had been in a hurricane. How
many adults should be surveyed to estimate the true proportion of adults who have been in a
hurricane, with a 95% confidence interval 6% wide?

Step 1: Using the data given in the question, figure out the following variables:

 za/2: Divide the confidence interval by two, and look that area up in the z-table:
.95 / 2 = 0.475
The closest z-score for 0.475 is 1.96.
 E (margin of error): Divide the given width by 2.
6% / 2
= 0.06 / 2
= 0.03
 : use the given percentage. 41% = 0.41. If you aren’t given phat, use 50%.
 : subtract from 1.
1 – 0.41 = 0.59

Step 2:Multiply by . Set this number aside for a moment.

0.41 × 0.59 = 0.2419

Step 3: Divide Za/2 by E.

1.96 / .03 = 65.3333333
Step 4: Square Step 3:
65.3333333 × 65.3333333 = 4268.44444

Step 5: Multiply Step 2 by Step 4:

0.2419 × 4268.44444 = 1,032.53671
= 1,033 people to survey.

C.) How to Find a Sample Size Given a Confidence Interval and Width (known population
standard deviation)

Part 3 shows you how to determine the appropriate sample size for a given confidence interval
and width, given that you know the population standard deviation.

Sample question: Suppose we want to know the average age of an Florida State College student,
plus or minus 0.5 years. We’d like to be 99% confident about our result. From a previous study,
we know that the standard deviation for the population is 2.9.

Step 1: Find z a/2 by dividing the confidence interval by two, and looking that area up in the z-
table:
.99/2 = 0.495. The closest z-score for 0.495 is 2.58.

Step 2: Multiply step 1 by the standard deviation.

2.58 * 2.9 = 7.482

Step 3: Divide Step 2 by the margin of error. Our margin of error (from the question), is 0.5.
7.482/0.5 = 14.96

Step 4: Square Step 3.

14.96 * 14.96 = 223.8016