BSA 1-4

Point Estimate. A point estimate of a population parameter is a single value used to estimate the
population parameter. For example, the sample mean x is a point estimate of the population mean μ

In statistics, point estimation involves the use of sample data to calculate a single value (known as a
point estimate since it identifies a point in some parameter space) which is to serve as a "best guess" or
"best estimate" of an unknown population parameter (for example, the population mean).In statistics,
point estimation involves the use of sample data to calculate a single value which is to serve as a "best
guess" or "best estimate" of an unknown population parameter. More formally, it is the application of a
point estimator to the data to obtain a point estimate

Point estimators are functions that are used to find an approximate value of a population parameter
from random samples of the population. They use the sample data of a population to calculate a point
estimate or a statistic that serves as the best estimate of an unknown parameter of a population

In statistics, interval estimation is the use of sample data to calculate an interval of plausible values of an
unknown population parameter; this is in contrast to point estimation, which gives a single value.

Interval Estimate

An interval estimate is defined by two numbers, between which a population parameter is said to lie. For
example, a < μ < b is an interval estimate for the population mean μ. It indicates that the population
mean is greater than a but less than b.

Interval Estimator - (or confidence interval) a formula that tells us how to use sample data to calculate

A confidence level refers to the percentage of all possible samples that can be expected to include the
true population parameter.

Description. In statistics, a confidence interval is a type of interval estimate, computed from the statistics
of the observed data, that might contain the true value of an unknown population parameter.

The standard deviation requires us to first find the mean, then subtract this mean from each data point,
square the differences, add these, divide by one less than the number of data points, then (finally) take
the square root. On the other hand, the range rule only requires one subtraction and one division.
 The standard deviation and range are both measures of the
spread of a data set. Each number tells us in its own way how
spaced out the data are, as they are both a measure of
variation. Although there is a not an explicit relationship
between the range and standard deviation, there is a rule of
thumb that can be useful to relate these two statistics. This
relationship is sometimes referred to as the range rule for
standard deviation.

You are estimating the population proportion, p.

All estimation done here is based on the fact that the normal
can be used to approximate the binomial distribution when np
and nq are both at least 5. Thus, the p that were talking about
is the probability of success on a single trial from the binomial
experiments.

Recall:

The best point estimate for p is p hat, the sample proportion:

If the formula for z is divided by n in both the numerator and the denominator, then the formula for z
becomes:

Solving this for p to come up with a confidence interval, gives the maximum error of the estimate as: .

This is not, however, the formula that we will use. The problem with estimation is that you don't know
the value of the parameter (in this case p), so you can't use it to estimate itself - if you knew it, then
there would be no problem to work out. So we will replace the parameter by the statistic in the formula
for the maximum error of the estimate.

The maximum error of the estimate is given by the formula for E shown. The Z here is the z-score
obtained from the normal table, or the bottom of the t-table as explained in the introduction to
estimation. The z-score is a factor of the level of confidence, so you may get in the habit of writing it next
to the level of confidence.

When you're computing E, I suggest that you find the sample proportion, p hat, and save it to P on the
calculator. This way, you can find q as (1-p). Do NOT round the value for p hat and use the rounded value
in the calculations. This will lead to error. Once you have computed E, I suggest you save it to the
memory on your calculator. On the TI-82, a good choice would be the letter E. The reason for this is that
the limits for the confidence interval are now found by subtracting and adding the maximum error of the
estimate from/to the sample proportion.

x bar - E < mu < x bar + E

The difference between t-test and z-test can be drawn clearly on the following grounds:

The t-test can be understood as a statistical test which is used to compare and analyse whether the
means of the two population is different from one another or not when the standard deviation is not
known. As against, Z-test is a parametric test, which is applied when the standard deviation is known, to
determine, if the means of the two datasets differ from each other.

The t-test is based on Student’s t-distribution. On the contrary, z-test relies on the assumption that the
distribution of sample means is normal. Both student ’s t-distribution and normal distribution appear
alike, as both are symmetrical and bell-shaped. However, they differ in the sense that in a t-distribution,
there is less space in the centre and more in the tails.

One of the important conditions for adopting t-test is that population variance is unknown. Conversely,
population variance should be known or assumed to be known in case of a z-test.

Z-test is used to when the sample size is large, i.e. n > 30, and t-test is appropriate when the size of the
sample is small, in the sense that n < 30.