Estimation

CONFIDE N C E IN T E R VA LS
FOR T H E M E A N
CONFIDENCE
INTERVAL FOR THE
MEAN WHEN σ IS
KNOWN
• In an interval estimate, the parameter is
specified as being between two values.
• Either the interval contains the parameter or
it does not. A degree of confidence (usually a
percent) must be assigned before an interval
estimate is made.
• To be more confident that the interval
contains the true population mean, you must
make the interval wider.
• Three common confidence intervals are
used:
the 90%, the 95%, and the 99% confidence

intervals.
EXAMPLE
A researcher wishes to estimate the number of times
a person skips breakfast during the year. A random
sample of 49 people had a mean of 50. Assume the
population standard deviation is 2.6. Find the best
point estimate of the mean and the 95% confidence
interval for the population mean.
EXAMPLE
A nutritionist wanted to find the average amount of candy
consumed per year by Filipinos. The nutritionist selected a
random sample of 60 adults to study. The sample mean
was 23.9 pounds of candy consumed per year. Assume the
population standard deviation is 4.8. Find the best point
estimate of the mean and the 99% confidence interval of
the population mean.
EXAMPLE
The following data represent a random sample of
the assets (in millions of dollars) of 30 credit unions
in Metro Manila. Assume the population standard
deviation is 14.405. Find the 90% confidence
interval of the mean.
The term is called the margin of error (also called the
maximum error of the estimate).
Rounding Rule for a Confidence Interval for a Mean
• When you are computing a confidence interval for a

population mean by using raw data, round off to one more
decimal place than the number of decimal places in the
original data.
• When you are computing a confidence interval for a
population mean by using a sample mean and a standard
deviation, round off to the same number of decimal places as
given for the mean.
EXAMPLE
A sociologist wishes to estimate the average number
of automobile thefts in a large city per day within 2
automobiles. He wishes to be 99% confident, and
from a previous study the standard deviation was
found to be 4.2. How many days should he select to
survey?
CONFIDENCE
INTERVAL FOR THE
MEAN WHEN σ IS
UNKNOWN
EXAMPLE
A random sample of 16 cats had a mean life
expectancy of 15.3 years. The standard
deviation of the sample was 2.3 years. Assume
the variable is normally distributed. Find the
95% confidence interval of the population
mean life expectancy of cats.
EXAMPLE
A random sample of gasoline taxes (in cents) is
shown here for 12 provinces in the Philippines. Use
the data to estimate the true population mean
gasoline tax with 90% confidence. Does your
interval contain the national average of 44.7 cents?
SEATWORK #1
The approximate costs in thousands of pesos for
30-second randomly selected spots for various
cable networks in a random selection of cities are
shown. Assume that the population is normally
distributed.
CONFIDE N C E IN T E R VA LS
FO R P R O P O R T IO N S
“For people who were asked if they won $5,000 tomorrow,
54% of them said that they would use it to pay off their
debts.” (ING U.S. Survey)
“In a recent survey of 540 Filipino adults, 378 said that they
plan on traveling this summer.”
The figure below is from a survey of 800 U.S. adults.
• A proportion represents a part of a whole. It
can be expressed as a fraction, decimal, or
percentage.
• Proportions can also represent probabilities.
EXAMPLE
In a random sample of 120 teachers, 48 of them

have master’s degree. Find the value of and .
EXAMPLE
A random sample of 150 assault victims in a

large city found that 45 took no self-protection
actions against the criminal. Find and , where is
the proportion of victims who took no
self-protection action against the criminal.
EXAMPLE
A sample of 150 students were chosen at random
from all Grade 11 students in a private school in
Pampanga. The sample indicated that 75% of
them were in favor of having an educational trip.
Find (a)95% and (b) 99% confidence intervals
for the proportion of all students who are in
favor of having an educational trip.
EXAMPLE
A survey conducted by Sallie Mae and Gallup of

1404 respondents found that 323 students paid
for their education by student loans. Find the
90% confidence interval of the true proportion
of students who paid for their education by
student loans.
EXAMPLE
A survey of 6000 adults found that 58% say that they

would take a ride in a fully self-driving car. Find the
90% confidence interval of the true proportion who
said that they would take a ride in a self-driving car.
There are two situations to consider.
• First, if some approximation of is known (e.g.,
from a previous study), that value can be used in
the formula.
• Second, if no approximation of is known, you
should use = 0.5.

Estimation

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CONFIDE N C E IN T E R VA LS

the 90%, the 95%, and the 99% confidence

• When you are computing a confidence interval for a

In a random sample of 120 teachers, 48 of them

A random sample of 150 assault victims in a

A survey conducted by Sallie Mae and Gallup of

A survey of 6000 adults found that 58% say that they

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