Statistical

Inferences
ESTIMATION
 Estimation

In the real world we frequently do not know

the values of population parameters and will
have to estimate them using sample statistics
 Estimation

Estimation is a procedure by which a numerical

value or values (estimate) are assigned to a
population parameter based on the
information collected from a sample. The
sample statistic used to estimate a population
parameter is called an estimator.
 Types of Estimates

There are two types of Estimators:

1. Point Estimators
2. Interval Estimates
 Point Estimates

If we select a sample and compute a single

value of the sample statistic for this sample,
then this value gives the point estimate of the
corresponding population parameter
 Point Estimates

Unbiased Estimates
An unbiased estimator is an accurate statistic
that's used to approximate a population
parameter. “Accurate” in this sense means that
it's neither an overestimate nor an
underestimate. It is the best estimator
 Point Estimates

Unbiased Estimates
An unbiased estimator holds the property:
෠
E(𝜃)=𝜃
 Point Estimates

Unbiased Estimates
An unbiased estimator holds the property:
෠
E(𝜃)=𝜃

That is, the average of all the sample statistics

is equal to the true population parameter.
 Point Estimates

Unbiased Estimates
 Interval Estimates
In interval estimation, an interval is
constructed around the point estimate, and it is
stated that this interval is likely to contain the
corresponding population parameter.
 Confidence Intervals

Confidence intervals are interval estimates.

Instead of assigning a single value to a
population parameter, an interval is
constructed.
 Confidence Intervals

Each interval is constructed with regard to a

given confidence level and is called a
confidence interval. The confidence level
associated with a confidence interval states
how much confidence we have that this interval
contains the true population parameter. The
confidence level is denoted by (1-α)100%.
Confidence Intervals for the Mean
Confidence Intervals for the Mean
 Central Limit Theorem

The Central Limit Theorem states that

the sampling distribution of the sample
means approaches a normal distribution as
the sample size gets larger 𝑛 ≥ 30.
 The
Standard
Normal
Table
Finding the value of Z
 Finding the value of Z
Question:
Find the z value for a 97% confidence
interval
 Finding the value of Z
Question:
Find the z value for a 97% confidence
interval

97% = (1 −  )100%
Solution:
0.97 = 1 − 
 = 1 − 0.97
 = 0.03

= 0.015
2

Z = 2.17
 Finding the value of Z
Question:
Find the z value for a 95% confidence
interval
 Finding the value of Z
Question:
Find the z value for a 95% confidence
interval
95% = (1 −  )100%
0.95 = 1 − 
Solution:
 = 1 − 0.95
 = 0.05

= 0.025
2

Z = 1.96
 Finding the value of Z
Question:
Find the z value for a 99% confidence
interval
 Finding the value of Z
Question:
Find the z value for a 99% confidence
interval
99% = (1 −  )100%
0.99 = 1 − 
Solution:
 = 1 − 0.99
 = 0.01

= 0.005
2

Z = 2.58
 Solving Problems

Example:
At a certain hospital, the pulse rate of patients
is measured in the morning. A sample of 80
patients gave a mean of 69 beats and a
standard deviation of 4 beats. Calculate a 97%
confidence interval for the population mean.
 Solving Problems
Solution:
At a certain hospital, the pulse rate of patients is measured in the morning. A sample
of 80 patients gave a mean of 69 beats and a standard deviation of 4 beats. Calculate
a 97% confidence interval for the population mean.

n = 80 x = 69 s = 4

A 97% confidenceinterval is given by :

s s
x−z x+z
n n
4 4
69 − 2.17    69 + 2.17
80 80
69 − 0.97    69 + 0.97
68.03    69.97
If the activity of drawing a random sample of 80 from the population is repeated a large
number of times, and for each repetition, the sample mean is computed, then 97% of the
time, the true value of the population mean will lie between 68.03 and 69.97.
Interpreting Confidence Intervals
Interpretation is always in the form:

If the activity of drawing a random sample of size (sample size) from the population
is repeated a large number of times, and for each repetition, the sample mean is
computed, then (confidence Interval)% of the time, the true value of the population
mean will lie between (lower end point) and (upper end point)
 Solving Problems
Example:
A publishing company wants to know the average price of all
accounts textbooks in the market. A sample of 25 comparable
textbooks gave a mean price of $145 for this sample. It is
known that the standard deviation of the prices of all such
textbooks is $35 and the population of such prices is normal.
a. What is the point estimate of the mean price of all such
college textbooks?

b. Construct a 90% confidence interval for the mean price of

all such college textbooks.
 Solving Problems
Example:
A publishing company wants to know the average price of all accounts textbooks
in the market. A sample of 25 comparable textbooks gave a mean price of $145 for
this sample. It is known that the standard deviation of the prices of all such
textbooks is $35 and the population of such prices is normal.
a. What is the point estimate of the mean price of all such college textbooks?
b. Construct a 90% confidence interval for the mean price of all such college
textbooks.

Solution:
The point estimate of the mean price of all such college textbooks is
𝑥ҧ = $145
 Solving Problems
Example:
A publishing company wants to know the average price of all accounts textbooks
in the market. A sample of 25 comparable textbooks gave a mean price of $145 for
this sample. It is known that the standard deviation of the prices of all such
textbooks is $35 and the population of such prices is normal.
a. What is the point estimate of the mean price of all such college textbooks?
b. Construct a 90% confidence interval for the mean price of all such college
textbooks.

Solution:
 Solving Problems
Example:
A publishing company wants to know the average price of all accounts textbooks
in the market. A sample of 25 comparable textbooks gave a mean price of $145 for
this sample. It is known that the standard deviation of the prices of all such
textbooks is $35 and the population of such prices is normal.
a. What is the point estimate of the mean price of all such college textbooks?
b. Construct a 90% confidence interval for the mean price of all such college
textbooks.

Solution:
 Solving Problems
Example:
A publishing company wants to know the average price of all accounts textbooks
in the market. A sample of 25 comparable textbooks gave a mean price of $145 for
this sample. It is known that the standard deviation of the prices of all such
textbooks is $35 and the population of such prices is normal.
a. What is the point estimate of the mean price of all such college textbooks?
b. Construct a 90% confidence interval for the mean price of all such college
textbooks.

Solution:
 Solving Problems
Example:
A publishing company wants to know the average price of all accounts textbooks
in the market. A sample of 25 comparable textbooks gave a mean price of $145 for
this sample. It is known that the standard deviation of the prices of all such
textbooks is $35 and the population of such prices is normal.
a. What is the point estimate of the mean price of all such college textbooks?
b. Construct a 90% confidence interval for the mean price of all such college
textbooks.

Solution:
Small Samples
Small Samples
Small Samples
Small Samples
Small Samples
Small Samples
Confidence Intervals for the Proportion
Confidence Intervals for the Proportion
Confidence Intervals for the Proportion
THE END