Confidence Intervals

How confident are we that our
sample means make sense?
Confidence intervals
Maybe not
1. Find a confidence interval for the population mean
using a sample from a normal distribution with
known variance.

using a sample from any distribution with known or
unknown variance
3. Make inference from confidence intervals.

Point estimate
• A single number that estimates a population

parameter is called a point estimate
How confident we are about an estimate
depends on two factors:
• The size of the sample – the larger the size
of the sample, the closer the estimate is
likely to be to the true population mean
• The variance of the population – if readings

are generally more varied the estimate will be
less reliable 
standard error 
n
where  is the population
standard deviation
When comparing two estimates of the same
or a similar parameters.
Point estimate
Given two samples:
1. Get each of their unbiased estimator of mean (point
estimate)
2. Calculate their standard errors
3. Rule of thumb the one with the smallest standard

error, is more likely to have an estimated mean
nearer to the population true mean.
Task
Calculate the standard error for the following:
10, 20, 30, 40, 50
1. Find mean
2. Find standard deviation
3. Find standard error

Difficulty using point estimate
• In complex situations the choice of an estimate of a

population parameter is not always clear. Statisticians
may find that they have no idea how to use the
sample data to estimate the population parameter of
interest, or they may in fact have several equally
plausible competing estimates to select from.
• Point estimates do not inform us about how much the

estimate is likely to be in error.
NORMAL DISTRIBUTION SAMPLE MEANS
Confidence Interval
9.00
90
 90%
100
6.00
Confidence Intervals
• A point estimate is the middle point of the interval

and the endpoints of the interval communicate the
size of the error associated with the estimate and
how ‘confident’ we are that the population parameter
is in the interval
9.00
6.00
Confidence Interval Calculation
• Typical confidence levels used in practice for confidence
intervals are 90%, 95% or 99% with 95% occurring most
frequently
• Find 95% from the

percentage points
table p=0.975 and
the value z=1.96

Confidence interval=x  1.645
1.96
n
Confidence Interval
The higher the level of confidence, the wider

the confidence interval needs to be.
90% find p=0.95 z=1.6449  1.645
95% find p=0.975 z=1.96
90% and 95% confidence intervals are given by:

   
 x  1.645 , x  1.645   90% interval
 n n
   
 x  1.96 , x  1.96   95% interval
 n n
Task
Fourteen users attempted to add a channel on their cable TV to a list of
favorites. After the task they rated the difficulty on the 7 point Single Ease
Question. Compute the 95% confidence interval. The responses are: 2, 6, 4,
1, 7, 3, 6, 1, 7, 1, 6, 5, 1, 1
1. Find the mean
2. Find the standard deviation
3. Find the standard error
4. Find the margin of error by multiplying the standard error by z
5. Find the confidence interval by adding the margin of error to the mean
and then subtracting the margin of error from the mean
All the questions that you have done so far
have been from populations that have been
normally distributed.
Central Limit Theorem states that if sample sizes are
large enough then the mean of any distribution is
approximately normally distributed with a standard
error 
n
therefore, any random sample where n is big enough

will have a 95% confidence interval given by:
   
 x  1.96 , x  1.96 
 n n
Using an estimated variance
• When the σ² is not known but n ≥ 30 an

unbiased estimate of the variance S2 can be
calculated using

x  n
x2

2
x  x
2
S 2
 i

n 1 n 1
• So when the variance or standard deviation are

not known replace σ² with S2 and σ with S
Task
100 people are comparing how many donuts they
ate at the donut festival. The mean is 6.5 and the
standard deviation is 3.2. Calculate the standard
error of the mean.
Key points
• A 95% confidence interval tells us that there is a probability of 0.95
that the interval contains the population μ
• If the sample is taken from a normal population then a 95%

confidence interval is given by    
 x  1.96 , x  1.96 
 n n 
• If the sample is taken from any distribution and n is large enough,
then a 95% confidence interval is given by
   
 x  1.96 , x  1.96 
 n n 
• If the population is not known then replace σ² with S2 and σ with S
and 95% can by given by:  S S 
 x  1.96 , x  1.96 
 n n
using a sample from a normal distribution with
known variance.

using a sample from any distribution with known or
unknown variance
3. Make inference from confidence intervals.

Confidence Intervals

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How confident are we that our

sample means make sense?

2. Find a confidence interval for the population mean

3. Make inference from confidence intervals.

• A single number that estimates a population

• The variance of the population – if readings

2. Calculate their standard errors

3. Rule of thumb the one with the smallest standard

2. Find standard deviation

3. Find standard error

• In complex situations the choice of an estimate of a

• Point estimates do not inform us about how much the

• A point estimate is the middle point of the interval

• Find 95% from the

The higher the level of confidence, the wider

90% and 95% confidence intervals are given by:

1. Find the mean

2. Find the standard deviation

3. Find the standard error

4. Find the margin of error by multiplying the standard error by z

therefore, any random sample where n is big enough

• When the σ² is not known but n ≥ 30 an

• So when the variance or standard deviation are

• If the sample is taken from a normal population then a 95%

2. Find a confidence interval for the population mean

3. Make inference from confidence intervals.

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