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It is important that the "standard deviation" used must be appropriate for the parameter we are estimating, so in this section we need to use the standard deviation that applies to sample means, which is σ n . The fraction σ n , is commonly called the "standard error of the mean" in order to distinguish clearly the standard deviation for a mean from the population standard deviation σ .

    In summary, as a result of the central limit theorem:

  • X ¯ is normally distributed, that is, X ¯ ~ N ( μ X , σ n ) .
  • When the population standard deviation σ is known, we use a normal distribution to calculate the error bound.

Calculating the confidence interval

To construct a confidence interval estimate for an unknown population mean, we need data from a random sample. The steps to construct and interpret the confidence interval are:

  • Calculate the sample mean x ¯ from the sample data. Remember, in this section we already know the population standard deviation σ .
  • Find the z -score that corresponds to the confidence level.
  • Calculate the error bound EBM .
  • Construct the confidence interval.
  • Write a sentence that interprets the estimate in the context of the situation in the problem. (Explain what the confidence interval means, in the words of the problem.)

We will first examine each step in more detail, and then illustrate the process with some examples.

Finding the z -score for the stated confidence level

When we know the population standard deviation σ , we use a standard normal distribution to calculate the error bound EBM and construct the confidence interval. We need to find the value of z that puts an area equal to the confidence level (in decimal form) in the middle of the standard normal distribution Z ~ N (0, 1).

The confidence level, CL , is the area in the middle of the standard normal distribution. CL = 1 – α , so α is the area that is split equally between the two tails. Each of the tails contains an area equal to α 2 .

The z-score that has an area to the right of α 2 is denoted by z α 2 .

For example, when CL = 0.95, α = 0.05 and α 2 = 0.025; we write z α 2 = z 0.025 .

The area to the right of z 0.025 is 0.025 and the area to the left of z 0.025 is 1 – 0.025 = 0.975.

z α 2  =  z 0. 025  = 1 .96 , using a calculator, computer or a standard normal probability table.

invNorm (0.975, 0, 1) = 1.96

Note

Remember to use the area to the LEFT of z α 2 ; in this chapter the last two inputs in the invNorm command are 0, 1, because you are using a standard normal distribution Z ~ N (0, 1).

Calculating the error bound ( EBM )

The error bound formula for an unknown population mean μ when the population standard deviation σ is known is

  • EBM = ( z α 2 ) ( σ n )

Constructing the confidence interval

  • The confidence interval estimate has the format ( x ¯ E B M , x ¯ + E B M ) .

The graph gives a picture of the entire situation.

CL + α 2 + α 2 = CL + α = 1.

This is a normal distribution curve. The peak of the curve coincides with the point x-bar on the horizontal axis. The points x-bar - EBM and x-bar + EBM are labeled on the axis. Vertical lines are drawn from these points to the curve, and the region between the lines is shaded. The shaded region has area equal to 1 - a and represents the confidence level. Each unshaded tail has area a/2.

Writing the interpretation

The interpretation should clearly state the confidence level ( CL ), explain what population parameter is being estimated (here, a population mean ), and state the confidence interval (both endpoints). "We estimate with ___% confidence that the true population mean (include the context of the problem) is between ___ and ___ (include appropriate units)."

Questions & Answers

what is standard deviation?
Jawed Reply
It is the measure of the variation of certain values from the Mean (Center) of a frequency distribution of sample values for a particular Variable.
Dominic
Yeah....the simplest one
IRFAN
what is the number of x
Godgift Reply
10
Elicia
Javed Arif
Jawed
how will you know if a group of data set is a sample or population
Kingsley Reply
population is the whole set and the sample is the subset of population.
umair
if the data set is drawn out of a larger set it is a sample and if it is itself the whole complete set it can be treated as population.
Bhavika
hello everyone if I have the data set which contains measurements of each part during 10 years, may I say that it's the population or it's still a sample because it doesn't contain my measurements in the future? thanks
Alexander
Pls I hv a problem on t test is there anyone who can help?
Peggy
What's your problem Peggy Abang
Dominic
Bhavika is right
Dominic
what is the problem peggy?
Bhavika
hi
Sandeep
Hello
adeagbo
hi
Bhavika
hii Bhavika
Dar
Hi eny population has a special definition. if that data set had all of characteristics of definition, that is population. otherwise that is a sample
Hoshyar
three coins are tossed. find the probability of no head
Kanwal Reply
three coins are tossed consecutively or what ?
umair
p(getting no head)=1/8
umair
or .125 is the probability of getting no head when 3 coins are tossed
umair
🤣🤣🤣
Simone
what is two tailed test
Umar Reply
if the diameter will be greater than 3 cm then the bullet will not fit in the barrel of the gun so you are bothered for both the sides.
umair
in this test you are worried on both the ends
umair
lets say you are designing a bullet for thw gun od diameter equals 3cm.if the diameter of the bullet is less than 3 cm then you wont be able to shoot it
umair
In order to apply weddles rule for numerical integration what is minimum number of ordinates
Anjali Reply
excuse me?
Gabriel
why?
Tade
didn't understand the question though.
Gabriel
which question? ?
Tade
We have rules of numerical integration like Trapezoidal rule, Simpson's 1/3 and 3/8 rules, Boole's rule and Weddle rule for n =1,2,3,4 and 6 but for n=5?
John
geometric mean of two numbers 4 and 16 is:
iphone Reply
10
umair
really
iphone
quartile deviation of 8 8 8 is:
iphone
sorry 8 is the geometric mean of 4,16
umair
quartile deviation of 8 8 8 is
iphone
can you please expalin the whole question ?
umair
mcq
iphone
h
iphone
can you please post the picture of that ?
umair
how
iphone
hello
John
10 now
John
how to find out the value
srijth Reply
can you be more specific ?
umair
yes
KrishnaReddy
what is the difference between inferential and descriptive statistics
Eze Reply
descriptive statistics gives you the result on the the data like you can calculate various things like variance,mean,median etc. however, inferential stats is involved in prediction of future trends using the previous stored data.
umair
if you need more help i am up for the help.
umair
Thanks a lot
Anjali
Inferential Statistics involves drawing conclusions on a population based on analysis of a sample. Descriptive statistics summarises or describes your current data as numerical calculations or graphs.
fred
my pleasure😊. Helping others offers me satisfaction 😊
umair
for poisson distribution mean............variance.
mehul Reply
both are equal to mu
Faizan
mean=variance
Faizan
what is a variable
Bonolo Reply
something that changes
Festus
why we only calculate 4 moment of mean? asked in papers.
Faizan Reply
why we only 4 moment of mean ? asked in BA exam
Faizan
Good evening, can you please help me by sharing regression and correlation analysis notes....thank you in advance
Refiloe Reply
Hello, can you please share the possible questions that are likely to be examined under the topic: regression and correlation analysis.
Refiloe
for normal distribution mean is 2 & variance is 4 find mu 4?
Faizan Reply
repeat quastion again
Yusuf
find mu 4. it can be wrong but want to prove how.
Faizan
for a normal distribution if mu 4 is 12 then find mu 3?
Faizan Reply
Question hi wrong ha
Tahir
ye BA mcqs me aya he teen he. 2dafa aya he
Faizan
if X is normally distributed. (n,b). then its mean deviation is?
Faizan
The answer is zero, because all odd ordered central moments of a normal distribution are Zero.
nikita
which question is zero
Faizan
sorry it is (5,16) in place of (n,b)
Faizan
I got. thanks. it is zero.
Faizan
a random variable having binomial distribution is?
Bokaho

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Source:  OpenStax, Introductory statistics. OpenStax CNX. May 06, 2016 Download for free at http://legacy.cnx.org/content/col11562/1.18
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