ESTIMATION
of
PARAMETERS
-Population Mean (𝜇)
CHAPTER 4
Point Estimator:
Module 1 • It refers to a single value
that best determines the
true parameter value of
Estimation the population.
Population Distribution Parameter
Concepts
Sample Distribution
:Definition Point estimator
6
Interval Estimator:
Module 1 • It gives a range of values within
which the parameter value
possibly falls.
Estimation • It is known as Confidence Interval.
Population distribution Parameter
Concepts
:Definition Interval estimator
Sample distribution 7
Confidence Level :
• It is a degree of certainty that
Module 1 the true population parameter
falls within the constructed
confidence interval.
Estimation • It has a value of (1-𝜶) in %.
Confidence level
Concepts 1-a
The value of a represents the probability of NOT
:Definition capturing the population mean. The total area to the
left tail and right tail.
8
Illustration 1:
• 90 times out of 100 the interval
Module 1 constructed around the sample mean
will capture the population mean.
• 10 times out of 100 the interval will
Estimation not capture the population mean
Co 90%
nf
I nt i d e n
Concepts er v ce
al
90%
:Interpretation -1.64 u +1.64
9
Interpretation:
ü 95 times out of 100
the interval
constructed around
the sample mean will
95%
Confidence Level
capture the
Confidence 95%
population mean.
Interval
ü 5 times out of 100 the
interval will not
capture the
-1.96 u +1.96
population mean.
Interpretation:
ü 99 times out of 100
the interval
99% constructed around
99% the sample mean will
Confidence capture the
Interval population mean.
ü 1 out of 100 the
-2.58 +2.58
interval will not
capture the
10
population mean
Module 1
Margin of Error (E):
Estimation ü It determines how reliable the
survey is or how reliable the
Concepts results of the experiment are.
ü The smaller the E, the more
accurate the survey seems to be.
ü The lower the margin of error,
the higher likely it is that the
:Definition results of the survey are true for
the whole population. 11
𝐹𝑜𝑚𝑢𝑙𝑎 1:
Module 2 𝑋* − 𝐸 < 𝝁 < 𝑋* + 𝐸
Confidence Interval 𝒘𝒉𝒆𝒓𝒆, 𝑬 = 𝒛
𝝈
𝒏
Estimation of the Below are the values of Confidence
Population Mean Levels that are commonly used
when 𝜎 is Known Confidence
Level
90%
𝒛
1.64
:Formula 95% 1.96
99% 2.58
14
Example 1:
A researcher wants to estimate the average number of hours per week that
college students spend on social media. A random sample of 100 college students is
selected, and their weekly social media usage is recorded. The sample mean is
found to be 15 hours with a population standard deviation of 5 hours. Calculate a
99% confidence interval for the true average number of hours per week that
college students spend on social media.
Given: Margin of Error (E): Lower Limit:
𝑥̅ − 𝐸 = 15 − 1.29
𝜎 = 13.71
• Sample size (n) = 100 𝐸=𝑧
𝑛 Upper Limit:
• Sample mean (𝑥)̅ = 15 hours 5
𝐸 = 2.58 𝑥̅ + 𝐸 = 15 + 1.29
• Population standard deviation 100 = 16.29
(σ) = 5 hours
Confidence Interval
• Confidence level (CL)= 99% 𝐸 = 1.29 13.71 < 𝜇 < 16.29 15
Confidence Interval
13.71 < 𝜇 < 16.29
Interpretation:
This means that we are 99% confident that the
actual average number of hours per week that college
students spend on social media falls within this interval.
16
Example 2:
A company is interested in estimating the average monthly revenue of its online
subscription service. They randomly select a sample of 50 subscribers and record
their monthly subscription fees. The sample mean monthly revenue is 1,500, with a
population standard deviation of 500. Calculate a 95% confidence interval for the
actual average monthly revenue of the company's online subscription service.
Given: Margin of Error (E): Lower Limit:
𝑥̅ − 𝐸 = 1,500 − 138.59
𝜎 = 1,361.41
• Sample size (n) = 50 𝐸=𝑧
𝑛 Upper Limit:
• Sample mean (𝑥)̅ = ₱1,500 500
𝐸 = 1.96 𝑥̅ + 𝐸 = 1,500 + 138.59
• Population standard deviation 50 = 1,638.59
(σ) = ₱500
𝐸 = 138.59
• Confidence level (CL)= 95%
Confidence Interval
₱1,361.41 < 𝜇 < ₱1,638.59
17
Confidence Interval
₱1,361.41 < 𝜇 < ₱1,638.59
Interpretation:
This means that we are 95% confident that the true
average monthly revenue falls within this interval.
18
Example 3:
A researcher did a pilot sample of 25 individuals with a population
standard deviation of 80. How many more must he survey to develop a
95% confidence interval that has 10 margin of error?
Given: Margin of Error (E): Conclusiom:
𝜎
• Sample size (n) = 25 𝐸=𝑧
𝑛 246 − 25 = 221
80
• Margin of Error (E)) = 10 10 = 1.96
𝑛 A researcher should survey
1.96 80 221 more to construct a
• Population standard deviation 𝑛=
(σ) = 80 10 95% confidence interval
𝑛 = 15.68 with a margin of error of
• Confidence level (CL)= 95% 𝑛 = 245.86 ≈ 246 10.
19
𝐹𝑜𝑚𝑢𝑙𝑎 1:
Module 3 𝑋* − 𝐸 < 𝝁 < 𝑋* + 𝐸
Confidence Interval 𝒘𝒉𝒆𝒓𝒆, 𝑬 = 𝒕
𝒔
𝒏
Estimation of the Where:
Population Mean t = a value found in the T-
Distribution Table with
when 𝜎 is Unknown df = n-1.
df = degrees of freedom
= represent the number of observations
:Formula in the sample that are free to vary
when estimating a population
parameter.
20
Ø The t-distribution is a valuable
tool in statistics, particularly
when dealing with small sample
sizes or when the population
standard deviation is unknown.
T- Distribution
Ø The t-distribution is similar to
the normal distribution, it
provides more accurate results
when dealing with small sample
sizes. Using the t-distribution
instead of the normal
distribution in these cases
ensures that our statistical
analyses are more reliable.
21
Example 4:
A researcher from the Department of Energy wants to estimate the mean price of
gasoline per liter in a certain city. A random sample of 25 gas stations in the city
is selected, and their prices per liter are recorded. The sample mean price is ₱70,
and the sample standard deviation is ₱7.55. Calculate a 95% confidence interval for
the population mean price of gasoline per gallon in this city, assuming the prices
follow a normal distribution.
Given: Margin of Error (E): Lower Limit:
𝑥̅ − 𝐸 = 70 − 3.12
8
• Sample size (n) = 25 𝐸=𝑡 , df=25-1 = 66.88
9 Upper Limit:
• Sample mean (𝑥)̅ = ₱70 7.55
• Sample standard deviation 𝐸 = 2.064 𝑥̅ + 𝐸 = 70 + 3.12
(s) = ₱7.55 25 = 73.12
• Confidence level 𝐸 = 3.12 Confidence Interval
(CL)= 95%
₱66.88 < 𝜇 < ₱73.12 22
Confidence Interval
₱66.88 < 𝜇 < ₱73.12
Interpretation:
This means that we are 95% confident that the
population mean price of gasoline per liter in this
city falls between ₱66.88 𝑎𝑛𝑑 ₱73.12.
This confidence interval suggests a range within
which we expect the true population mean to lie,
based on the sample data.
23
Example 5:
A SHS principal wants to estimate the average NAT score of all students in the
school. A random sample of 40 students is selected, and their NAT scores are
recorded. The sample mean NAT score is 84, and the sample standard deviation is
10. Calculate a 90% confidence interval for the population mean NAT score of all
students in the school, assuming the scores follow a normal distribution.
Given: Margin of Error (E): Lower Limit:
𝑥̅ − 𝐸 = 84 − 3.20
8 = 80.80
• Sample size (n) = 40 𝐸=𝑡 , df=40-1
9 Upper Limit:
• Sample mean (𝑥)̅ = 84 12
• Sample standard deviation 𝐸 = 1.684 𝑥̅ + 𝐸 = 84 + 3.20
(s) = 12 40 = 87.20
• Confidence level 𝐸 = 3.20 Confidence Interval
(CL)= 90%
80.80 < 𝜇 < 87.20 24
Confidence Interval
80.80 < 𝜇 < 87.20
Interpretation:
We are 90% confident that the population mean NAT score of
all students in the school falls between 80.80 and 87.20.
This confidence interval provides a range within which we
expect the true population mean NAT score to lie, based on
the sample data collected from the SHS students.
25
Example 6:
A survey is conducted to estimate the average number of tweets posted by SHS students
per day. A random sample of 105 students is selected, and their daily number of tweets is
recorded. The sample mean number of tweets is found to be 5.8, with a sample standard
deviation of 2.2 tweets. Given a confidence interval of (5.4, 6.2) tweets per day for the
population mean number of tweets made by SHS students on Twitter, what is the
confidence level associated with this interval?
𝑠
Given: Solutions: Step 2: E=𝑡
𝑛
2.2
0.4 = 𝑡
• Sample size (n) = 105 Step 1: Calculate the E. 105
!.# $!%
𝑈𝑝𝑝𝑒𝑟 𝐿𝑖𝑚𝑖𝑡 − 𝐿𝑜𝑤𝑒𝑟 𝐿𝑖𝑚𝑖𝑡 t= = 1.863
• Confidence Interval 𝐸=
&.&
(CI) = 5.4 < 𝜇 < 6.2 2
Step 3: Use the t-distribution
D.EFG.H table with 119 degrees of
• sample standard 𝐸= = 0.4 freedom and the critical t-value
deviation (s) = 2.2 E
of approximately 1.863.
With given t = 1.863
Using the t-distribution table with 119 degrees of
freedom found at ∞ and the critical t-value of
approximately 1.863, we find the closest confidence
level to a critical t-value of 1.863 is 95%.
27
Brainstorming
4
(Take Home)
Short Bond Paper
28
Workbook CHAPTER 4
Do Exercises, page 117
A. # 1 and 3
B. # 2, 4, and 6
Do Exercise, pages 121-122
A. # 5
B. # 2, 4 6, and 8
Do Exercise, pages 127-128
A. # 3
B. # 2, and 6
C. # 2, and 4
End of Chapter 4
