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Unformatted text preview: CHAPTER 10 Confidence Intervals There are two types of estimators in statistcis POINT estimate and INTERVAL estimates A (1  α) x 100% Confidence Interval for μ Assumptions: 1. Normal Population 2. σ is Known For a 95% Confidence Interval, Zα/2 =1.96 => α=.05 => α/2 = 0.025 0.48 0.48 α/2=0.025 α/2=0.025 0.95 Z α/2 Z α/2 10.22 page 319 n= 8, σ=10, 1α=.95 Ages are as follows: 52, 68, 22, 35, 30, 56, 39, 48 = 43.75+/6.9 Zα/2 =1.96 => α=.05 If asked to do a 93% interval it would be narrower The higher the confidence interval, the wider that interval gets At 99%, you'd be more confident in it, but have less info on μ 1α is called a confidence level is called a significance level. + n Z X n Z X σ σ α α * , * 2 2 n Z X σ α ± 2 8 10 96 . 1 75 . 43 ± n X X n i i ∑ = 1 7 5 . 4 3 8 3 5 0 1 = = = ∑ n X X n i i For 93% interval: Confidence Interval, 1α=.93, α=.07 => α/2 = 0.035 =>Zα/2 = 1.81 43.75+/6.46 [37.35, 50.15] **** Important PointConfidence Intervals are ALWAYS two sided (twotai...
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This note was uploaded on 10/21/2008 for the course MBA 803 taught by Professor Cantrell during the Spring '08 term at Clemson.
 Spring '08
 CANTRELL

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