Chapter 6: Statistical Inference

Inferences:
1. Confidence Interval: Point Estimator ± Margin of Error
2. Test of Hypothesis: Ho: guessing population value and use sample info to test it
Confidence Intervals:
Situation One: µ: Standard Deviation known alpha=size of error 1-alpha=Level of Confid.
𝜎
Formula: 𝑥 ± 𝑧𝛼 ∗ we can use CONFIDENCE.NORM(alpha, st. dev, n)
2 √𝑛
𝑠
Situation Two: µ: Standard deviation UNKNOWN! Formula: 𝑥 ± 𝑡𝛼 ∗ Excel: x-bar ± CONFIDENCE.T(alpha, s, n)
2 √𝑛
√𝑝(1−𝑝)
Situation Three: Proportions 𝑝 ± 𝑧𝛼 ∗
2 𝑛
Interpreting: In repeated sampling, 95% of the intervals will include the true µ. We are hoping our interval contains the actual µ.

Example 1: St. Dev known

N=40 3.2 ± z(.05/2) * .5/sqrt(40)
x-bar=3.2 3.2 ± {.15495 } ME For ME use CONFIDENCE.NORM(0.05.50.40)
st. dev=.5 CI: (3.045,3.355)
alpha=.05

Example 2: St. Dev Unknown

N=40 3.2 ± t.(.05/2) * .8/sqrt(40)
x-bar=3.2 CONFIDENCE.T(.05,.8,40)
s=.8 CI: (2.95,3.46)
alpha= .05

Example 3: Proportions
N=40 females are 25 out of 40 students so p-bar=25/40 alpha:.05
Therefore 0.625 ± 1.96 * sqrt(.625 * (1-.0625) / 40 = CI of (-0.15, .76)
Ho is true Ho is false