Week 7 – Day 1

Estimating Parameters (Mean) with

Known Population Standard
Deviation

Prayer
Attendance
Recording
 Recall
□ Critical values of the middle 90%, 95%, and
99% (See next slide)
□ Mean of the Sampling Distribution of the
Sample Means (equals μ)
□ Standard error of the mean ()
 Critical values,
Level of Area in each tail Critical values (Z)
Confidence ()

90% 0.05 ± 1.645

95% 0.025 ± 1.96
98% 0.01 ± 2.33
99% 0.005 ± 2.575
𝜶 𝜶
𝟐 𝟐
 From Bangko Sentral ng Pilipinas
The share of Filipino adults with bank accounts
soared to 56 percent in the first quarter from 29
percent in 2019, according to the 2021 Financial
How Survey
Inclusion did theyofget
thethe
Bangko Sentral ng
figures?
Pilipinas (BSP).

If 56% is 42.9 million

Filipino adults, did they
interview all of them?

https://www.philstar.com/business/2022/08/24/2204606/filipino-
adults-bank-accounts-jump-56
 Estimation of Parameters
Objectives:
1. Obtain a point estimate for the population
mean
2. Construct and interpret a confidence interval
for the population mean
3. Find the length of the interval
4. Determine the sample size necessary for
estimating a population mean within a
specified margin of error
 Definition

□ Point estimate
It is the value of a statistic that
estimates the value of a parameter.

The best point estimate is the sample

mean.
 Definition
The level of confidence represents
the expected proportion of intervals
that will contain the parameter if a
large number of different samples is
obtained. The level of confidence is
denoted (1 - )  100%.
 Definition
□ A confidence interval for an
unknown parameter consists of an
interval of numbers based on a
point estimate. It is of the form of

‘Point estimate  margin of error’

 Illustration

□ A 95% level of confidence ( = 0.05)

implies that if 200 different confidence
intervals are constructed, each based on
a different sample from the same
population, then we will expect 190 of
the intervals to include the parameter
and 10 to not include the parameter.
 Red line means the
interval does not contain
the parameter
(population mean, μ).

How many red lines are

there?
□ How is the margin of error
determined? (see next slide)
□ How do we construct an interval?
(Shape, Center, Spread)
 Formula
Estimated Population Mean =
Point Estimate  Interval estimate

Margin of error
 Formula

Length of the interval

¿2∗ 𝐸
Margin of error
The margin of error of a confidence
interval estimate of a parameter depends
on…
□ Level of confidence , margin of error 
□ Sample size , margin of error 
□ Standard deviation of the population ,
margin of error 
  
E  Z / 2   
 n
 Example 1 - Margin of error
□ A random sample of n = 50 pandas have an
estimated average weight of 215 pounds with
σ = 60 pounds. Estimate the margin of error for
the estimated mean using 90%.

𝐸=𝑍 𝛼/ 2 ⋅
𝜎
√𝑛( )
=1.645 ∙
60
√ 50
=13.96
 Example 2
Given that IQ Scores’ σ = 15 and a sample of
n=99 graduate students with , using 90% level of
confidence…
□ Compute the margin of error and determine
the length of the interval

□ Construct a 90% confidence interval for these

data.
 Example 2
Given that IQ Scores’ σ = 15 and a sample of
n=99 graduate students with , using 90% level of
confidence…
□ Compute the margin of error and determine the length of the interval

□ Construct a 90% confidence interval for these

data.
 Interpretation of a Confidence Interval

□ A (1 - )  100% confidence interval

indicates that (1 - )  100% of all simple
random samples of size n from the
population whose parameter is unknown
will result in an interval that contains the
parameter.
 Interpretation of a Confidence Interval

□ The interpretation of a confidence

interval is this: We are (insert level of
confidence) confident that the
population mean is between (lower
bound) and (upper bound). This is an
abbreviated way of saying that the
method is correct (1 - )  100% of the
time.
 Example 3
The president of a large university wishes to
estimate the average age of the students
presently enrolled. From past studies, the
standard deviation is known to be 2 years. A
sample of 50 students is selected, and the mean
is found to be 23.2 years. Compute the margin of
error then find the 95% confidence interval of
the population mean.
 Example 3
The president of a large university wishes to estimate the average
age of the students presently enrolled. From past studies, the
standard deviation is known to be 2 years. A sample of 50
students is selected, and the mean is found to be 23.2 years.
Compute the margin of error then interpret the 95% confidence
interval of the population mean.
 Formative 6-2a
A certain medication is known to increase the
pulse rate of its users. The standard deviation of
the pulse rate is known to be 5 beats per minute.
A sample of 30 users had an average pulse rate
of 104 beats per minute. Compute the margin of
error, length of the interval, then find the 99%
confidence interval of the true mean and
interpret.
 Formula
□ Solve for n in the Margin of error formula

  
E  Z / 2   
 n
 Formula
□ Minimum sample size needed
2
 Z / 2   
n 
 E 

( )
2
or 2 ∙ 𝑍 𝛼 /2 ⋅ 𝜎
𝑛=
𝐿
 Example 4
□ The college president asks the statistics teacher
to estimate the average age of the students at
their college. The teacher decides the estimate
should be accurate within 1 year and be 99%
confident. From a previous study, the standard
deviation of the ages is known to be 3 years.
How large a sample is necessary?
 Example 4
□ The college president asks the statistics teacher to
estimate the average age of the students at their
college. The teacher decides the estimate should be
accurate within 1 year and be 99% confident. From a
previous study, the standard deviation of the ages is
known to be 3 years. How large a sample is
necessary?

( ) (
2
𝑍 𝛼/ 2 ⋅ 𝜎
) =59.68 ≈ 60
2
2.575 ∗3
𝑛= =
𝐸 1
 Formative 6-2b
You want to estimate the average IQ Scores of
the students. You want to be accurate within 2
points and be 95% confident. If the standard
deviation is 15, how many samples do you need?
 Performance Task 1-3
□ With your approved question, prepare a google
form.
□ Using the google form, survey your target
respondents
□ Submit the pie chart of the result
 References
□ Agcaoili, L. (2022, August 24). Filipino adults with bank accounts jump
to 56%. PhilStar Global.
https://www.philstar.com/business/2022/08/24/2204606/filipino-adults-
bank-accounts-jump-56