BADM 572 Module 4 Study Session 7 April 2019

BADM 572 Module 4 Study Session
7 April 2019
Housekeeping
 Our study sessions will be held once per week and will focus on the course
objectives for that module
 Yes, I am recording this session and will post it in Workplace along with a PDF
of this presentation
 Our study sessions are in support of (not replacement for) the Coursera content,
live sessions, Compass content and Professor office hours
– Critical that you base your studies on the official materials
 I have assumed that you have watched the Coursera content and attended one of
the live sessions
2
Our Agenda
 Upon successful completion of this module, you will be able to:

– Build on sample information to create point estimates for the population.
– Build a confidence interval.
– Interpret confidence intervals.
– Apply desired level of error.
– Explain the trade-off between accuracy and precision.
– Determine sample size needed for the level accuracy and precision desired.
 Develop your answers to the following guiding questions while watching

lectures and working on assignments throughout the module.
– What does a confidence level mean?
– What is the impact of sample size on confidence interval?
– How can confidence interval become more accurate and precise?
– What are the chances that sample was not a good sample?
3
Confidence Interval Basics Translated
 Inferential statistics uses sample statistics to provide estimates for population
parameters.
– We use a sample to make educated guesses of the entire population
 A point estimate is a single number estimated of a population parameter.

– The sample average is a good starting point to guess at the population average
 This is still an estimate and we can’t be certain that it contains the true population
parameter.
– But our guess could be totally wrong
 The probability that the interval actually contains the true population parameter is called
the level of confidence.
– But what if we guessed lots of times? Our one sample can help us guess at what would happen
 An interval estimate associated with a certain level of confidence is called a confidence

interval.
– Both our guess at the population average and our guess at what would happen to the average
of the averages of many samples will tell us how good or bad our guesses really are
4
What do all these symbols mean?
5
Forget what you know about the population
6
Confidence Intervals
In prior modules
In prior modules
In this module
7
Point Estimates Defined
earlier
8
9
10
Not important for Confidence Intervals
 In descriptive statistics,
the interquartile
range (IQR), also called
the midspread or middle
50%, or technically H-
spread, is a measure of
statistical dispersion,
being equal to the
difference between 75th
and 25th percentiles, or
between upper and lower
quartiles, IQR = Q3 − Q1.
11
What we know
Sample mean: 240.79
Sample Std Dev: 20
Sample Size: 16
Note: SRS = Simple Random Sample
12
What we know
Sample mean: 240.79
Sample Std Dev: 20
Sample Size: 16
Std error: 5
13
What we know
Sample mean: 240.79
Sample Std Dev: 20
Sample Size: 16
Std Error: 5
14
15
16
What we know
Sample mean: 240.79
Sample Std Dev: 20
Sample Size: 16
Std Error: 5
17
What we know
Sample mean: 240.79
Sample Std Dev: 20
Sample Size: 16
Confidence Int:
Upper Bound: 250.79
Lower Bound: 230.79
18
What we know
Sample mean: 240.79
Sample Std Dev: 20
Sample Size: 16
Confidence Int:
Upper Bound: 250.79
Lower Bound: 230.79

19
20
21
Z and t values – what are they really?
• Standard Deviation
is a distance from
the mean
• Can be generically
described as “1
standard deviation”
• Z score is the
number of standard
deviations
22
If we want 95% confidence, why do we use .975?
Because we will add and subtract our margin of error from our sample mean
to get a confidence interval
23
What is the average MPG of cars in the US
Example
24
Build a confidence interval - Example
 https://shiny.rit.albany.edu/stat/confidence/
 http://www.rossmanchance.com/applets/ConfSim.html
 https://www.geogebra.org/m/FdDGqzSM
25
26
Confidence Interval does not mean there is a 95% chance you are right for a single sample
or that, out of 100 items in a sample, 5 or less will be wrong, in a sample
27
28
Precision vs accuracy
 The more confident we want to be, the larger the margin of error must be
 Every confidence interval is a balance between certainty and precision
 The larger the confidence interval, the more certain we are that the true
population mean is within the range but less precise we are about that range
– We are 99% sure that our true average is between 1 and 100
 The smaller the confidence internal, the less certain we are that the true
population mean is within the range but more precise we are about that range
– We are 90% sure that our true average is between 3 and 6
29
Confidence Intervals for Population Proportions
30
31
32
33
34
35
36
37
38
39
Sample Size
40
Sample Size
41
Sample Size
42
Sample Size
43
Thank you for attending
Questions?
44

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BADM 572 Module 4 Study Session

 Upon successful completion of this module, you will be able to:

 Develop your answers to the following guiding questions while watching

 A point estimate is a single number estimated of a population parameter.

 An interval estimate associated with a certain level of confidence is called a confidence

Note: SRS = Simple Random Sample

Note: SRS = Simple Random Sample

Note: SRS = Simple Random Sample

Note: SRS = Simple Random Sample

 Every confidence interval is a balance between certainty and precision

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