Estimation Theory

Two Types of Estimates:

1. Point Estimates
2. Interval Estimates
A. Two-Sided* Interval Estimates for a Single Mean:
Case1: X Z
Case2: X t

x
n

X Z

or

s
n

s
n

v = n-1

B. Two-Sided Interval Estimates for Difference of Two Means

B.1 Independent Samples
Case1: ( x1 x2 ) Z

Case2:

12 2 2
S12 S 2 2
or ( x1 x2 ) Z

n2
n1 n2
2 n1

1 1
( x1 x 2 ) t S p

2
n1 n2

(n1 1) S12 (n2 1) S 2 2

or S p
n1 n2 2

v = n1 + n2 2

Case3: ( x1 x2 ) t

s12 s 2 2

n1 n2

s12 s22

n1 n2
s12

n1

n1 1

s22

n2

n2 1

*One-Sided Confidence Intervals are possible. These are called one-sided lower bound or
one-sided upper bpund.

B.2 Dependent Samples

 Sd

2
n

d t

if n < 30, V= n-1

Sd

2 n

d Z

if n 30

C. Two-Sided Interval Estimate of A Single Variance or Standard Deviation

(n 1) s 2

(n 1) s 2

1 2

v = n-1

D. Two-Sided Interval Estimate of Ratio of Two Variances/ Standard

Deviations
s12

s2

2 s2
1
12 12 F 2, 1
F 1, 2 2 s 2
2
2

v1 = n-1, v2 = n-2

E. Two-Sided Interval Estimate of Single Proportion

p Z

F.

pq
n

Two-Sided Interval
Proportions

p1 p2 Z

p1 q1
2

n1

Estimate

of

Difference

of

Two

p2 q 2
n2

Problem Set:
1.
The Director of Quality of a large health maintenance
organization wants to evaluate patient waiting time at a local facility.
A random sample of 25 patients selected from the appointment book.
The waiting time was defined as the time from when a patient signed
in to when he or she was seen by the doctor. The following data
represent the waiting time (in minutes)

19.5
25.4
26.1
10.7
41.3
Set up a 95 % confidence
waiting time.

30.5 45.6 39.8

21.8 28.6 52.0
31.1 43.1
4.9
12.1
1.9 45.9
13.8 17.4 39.0
interval estimate

29.6
25.4
12.7
42.5
36.6
of the population average

2. It is desired to estimate the difference between the mean starting

salaries for all bachelors degrees graduates of DLSU in the Colleges
of Engineering and Computer Science during the past year. The
following information is available from the Career Development
Office:
A random sample of 40 starting salaries for Engineering
graduates produced a sample mean of P230,500 and a
standard deviation of P38,515.
A random sample of 30 starting salaries for CompSci graduates
produced a sample mean of P192,000 and a standard deviation
of P35,452.
Construct a 95% confidence interval for the difference between
mean starting salaries for graduates of the two colleges. Interpret
the interval.
3. The Farm has received claims from its customers that the weight of point-of-sale
adult pigs from its two farms are different by 5 kgs. The resident veterinarian
decided to check the validity of this claim. He took 10 pigs from each farms
available pigs for sale, and the following data was found.
Farm
Farm
1
2
sample size
10
10
pigs
pigs
Mean weight 90.5
85.0
standard deviation
3.2
3.4
of wts
Is the claim significant at 95% confidence level.
4. In a recent employee satisfaction survey made by J.Rizal Industries, 356 out of 400
employees stataed that they were very satisfied or moderately satisfied with their
jobs. Create a 95% c.i. estimate of the population proportion of the employees who
were satisfied with their jobs.
5. Construct a 95 % CI on the variance based on the following set of
data (the amount of Krypton gas (in milliliters) that leaked out each
time its container was dropped from 4 ft above ground):

15.5 16.8 16.7 15.4 16.4 17.5

17.8 17.5 18.3 14.5 18.1 15.7
19.5 18.6 19.7 15.8 18.2 16.8
6. A random sample of 50 suspension helmets used by motorcycle riders and
automobile race-car drivers was subjected to an impact test, and on 18 of these
helmets some damaged was observed.
a. Find a 95% two-sided confidence interval on the true proportion of
helmets of this type that would show damage from this test.
b. Using the point estimate of p obtained from the preliminary sample of 50
helmets, how many helmets must be tested to be 95% confident that the
error in estimating the true value of p is les than 0.02?
c. How large must the sample be if we wish to be at least 95% confident that
the error in estimating p is less than 0.02, regardless of the true value of p?
7. A random sample of n=64 observations has a mean of 29.1 and a standard
deviation of 3.9.
a. Give the point estimate of the population mean.
b. Find a 90% confidence interval for the population mean.
c. Find a 90% lower confidence bound for the population mean. Why is this
bound different from the lower confidence limit in question b?
d. How many observations do you need to estimate the true mean to within
0.5 with probability equal to 0.95?
8. Page 256 #11 of your book.
9. Page 262 #1 of your book.
10. Page 263 #16 of your book.
11. Page 256 #5 of your book.
12. Page 245 #4 and #8 of your book.