8.
      Confidence Intervals
      MACT 2222, Statistics for business
 MACT 2222: Statistics for Business        8.1
8.2
      Outline
        • Sampling Distributions
        • Confidence Interval for the Population Mean µ
        • Confidence Interval for Proportion π
 MACT 2222: Statistics for Business                       8.2
8.3
       Sampling Distributions
      1. The sample mean is a random variable with  a
         probability distribution called the sampling
         distribution of .
      2. The sampling distribution of has a mean of µ, the
         original population mean, and a standard deviation
         called the standard error of the mean given as .
      3. If the sample is coming from a normal distribution
         then follows a normal distribution with a mean µ and
          a standard error .
 MACT 2222: Statistics for Business                             8.3
8.4
      Sampling Distributions
      4. If the sample is not coming from a normal distribution 
      and if the sample size is sufficiently large (n≥30) then the
      sample mean will be approximately normal according
      to the central limit theorem (CLT).
      5. obability related to from the normal distribution we
      use the following Z-score
                                          .
 MACT 2222: Statistics for Business                                  8.4
8.5
      Sampling Distributionss
         6. If someone is interested in the proportion (π) of
                                                             a
         certain category of a qualitative variable then a
         sample proportion of the category of interest is
         calculated as , where is the size of this category in
         the sample or in other words the number of
         successes and is the sample size.
         7. Sample proportion is a random variable with mean
         and a standard error =. For a sample of size 30, is
         approximately normal and for any probability related
         to we use the following Z score .
 MACT 2222: Statistics for Business                              8.5
8.6
      Example 1
      • The foreman of a bottling plant has observed that the amount
                                                                          of soda in each “32-ounce” bottle is actually a normally
        distributed random variable, with a mean of 32.2 ounces and a
        standard deviation of .3 ounce.
      • If a customer buys a carton of four bottles, What is the
        distribution of the sample mean
      • what is the probability that the mean amount of the four
        bottles will be greater than 32 ounces?
     6
 MACT 2222: Statistics for Business                                     8.6
8.7
      Example 1: Solution
       is
        normally distributed.
      We want to find where is normally distributed and
      standard error =
     7
 MACT 2222: Statistics for Business                       8.7
8.8
      Example 2
     8
 MACT 2222: Statistics for Business   8.8
8.9
      Summary
        We only need to know that we have three  
        different z-scores
      1. One for X,
      2. One for ,
      3. One for
      4. We only use the normal distribution to find any
         probability related to any of the above.
 MACT 2222: Statistics for Business                        8.9