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1 Slide IS 310 - Business Statistics
1 Slide IS 310 - Business Statistics
Business
Statistics
CSU
Long Beach
Interval Estimation of m 1 – m 2
Expected Value
E ( x1 x2 ) 1 2
12 22
x1 x2
n1 n2
12 22
x1 x2 z / 2
n1 n2
where:
1 - is the confidence coefficient
Sample #1 Sample #2
Par, Inc. Rap, Ltd.
Sample Size 120 balls 80 balls
Sample Mean 275 yards 258 yards
Point estimate of 1 - 2 = x1 x2
= 275 - 258
= 17 yards
where:
1 = mean distance for the population
of Par, Inc. golf balls
2 = mean distance for the population
of Rap, Ltd. golf balls
H 0 : 1 2 D0 H 0 : 1 2 D0 H 0 : 1 2 D0
H a : 1 2 D0 H a : 1 2 D0 H a : 1 2 D0
Left-tailed Right-tailed Two-tailed
Test Statistic
( x1 x2 ) D0
z
2
2
1 2
n1 n2
Interval Estimation of m 1 – m 2
Interval estimate
_ _ 2 2
(x - x ) ± t √ (s /n + s /n )
1 2 /2 1 1 2 2
Degree of freedom = n + n - 2
1 2
Sample #1 Sample #2
M Cars J Cars
24 cars 28 cars Sample Size
29.8 mpg 27.3 mpg Sample Mean
2.56 mpg 1.81 mpg Sample Std. Dev.
Point estimate of 1 - 2 = x1 x2
= 29.8 - 27.3
= 2.5 mpg
where:
1 = mean miles-per-gallon for the
population of M cars
2 = mean miles-per-gallon for the
population of J cars
H 0 : 1 2 D0 H 0 : 1 2 D0 H 0 : 1 2 D0
H a : 1 2 D0 H a : 1 2 D0 H a : 1 2 D0
Left-tailed Right-tailed Two-tailed
Test Statistic
( x1 x2 ) D0
t
2 2
s s
1
2
n1 n2
( x1 x2 ) D0 (29.8 27.3) 0
t 4.003
2 2 2 2
s s (2.56) (1.81)
1
2
n1 n2 24 28