Sampling Methods and

the Central Limit Theorem

Chapter 8

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Learning Objectives
LO8-1 Explain why populations are sampled and
describe four methods to sample a
population
LO8-2 Define sampling error
LO8-3 Demonstrate the construction of a
sampling distribution of the sample mean
LO8-4 Recite the central limit theorem and define
the mean and standard error of the
sampling distribution of the sample mean
LO8-5 Apply the central limit theorem to
calculate probabilities

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Reasons for Sampling a Population
 The results of a sample may adequately estimate the value
of the population parameter, saving time and money
 It may be too time-consuming to contact all members of
the population
 It may be impossible to check or locate all the members
of the population
 The cost of studying all the items in the population may
be prohibitive
 Often testing destroys the sampled item and it cannot be
returned to the population

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Probability Sampling Methods
 In a simple random sample, all members of the population
have the same chance of being selected for the sample
 In a systematic sample, a random starting point is
selected, and then every kth item thereafter is selected
for the sample
 In a stratified sample, the population is divided into
several groups, called strata, and then a random sample is
selected from each stratum
 In clustered sampling, the population is divided into
primary units, then samples are drawn from the primary
units

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Simple Random Sampling
 The most widely used method of sampling is a simple
random sample
SIMPLE RANDOM SAMPLE A sample selected so that each item or
person in the population has the same chance of being selected.

 Example
 There were 750 Major League Baseball players at the end
of the 2016 season. A committee of 10 players is to be
formed to study the issue of concussions. To make sure
every player has an equal chance of being selected, write
each name on a piece of paper, place the names in a box
and mix them up, then draw 10 names.

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Using a Table of Random Numbers
Suppose the population of interest is the 220 BPL players on the active
rosters of the 11 teams at the end of the 2021 season. A committee of 10
players is to be formed to study the issue of ligament injury. To make sure
every player has an equal chance of being selected, use a table of random
numbers.
1. Prepare of list of all the players and number them 1 through 220
2. Randomly pick a starting place in the random number table
3. Select 10 three-digit numbers between 1 and 220

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Systematic Random Sampling
 If you do not have a list of the entire population to begin with,
you can use the systematic random sample
SYSTEMATIC RANDOM SAMPLE A random starting point is selected,
and then every kth member of the population is selected.

 Example
 Sales division of Computer Graphic Inc. needs to quickly estimate the mean
dollar revenue per sale during the past month. It finds that 2,000 sales invoices
were recorded and stored in file drawers, and decides to select 100 invoices to
estimate the mean dollar revenue.
 First, k is calculated as the population size divided by the sample size. For
Computer Graphic Inc., we would select every 20th (2,000/100) invoice from the
file drawers; in so doing, the numbering process is avoided. If k is not a whole
number, then round down.
 Random sampling is used in the selection of the first invoice. For example, a
number from a random number table between 1 and k, or 20, would be selected.
Say the random number was 18. Then, starting with the 18th invoice, every 20th
invoice (18, 38, 58, etc.) would be selected as the sample.

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Stratified Random Sampling
 When the population can be divided into groups based
on some characteristic, use stratified random sampling
STRATIFIED RANDOM SAMPLE A population is divided into
subgroups, called strata, and a sample is randomly selected from each
stratum.
 Example
 A study of 50 of the 352 largest US firms’ ROE
 Begin by identifying the strata, then use random sampling
within each group based on relative frequencies to collect
the sample

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Cluster Sampling
 Cluster sampling is a common type of sampling, used to
reduce the cost of sampling over large geographic areas

CLUSTER SAMPLING A population is divided into clusters using

naturally occurring geographic or other boundaries. Then clusters are
randomly selected and a sample is collected by randomly selecting from
each cluster.

 Example
 Suppose we wish to sample residents
of the 12 counties in the greater Chicago
area about government policy. Randomly
select 3 counties and then select a
random sample of the residents
in each of the 3 counties.
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Sampling Error
 It is unlikely the mean of a sample will be exactly equal to the
mean of the population

SAMPLING ERROR The difference between a sample statistic and its

corresponding population parameter.

 Example
 The Foxtrot Inn’s number of rooms rented in June. The mean
number of rooms rented, μ, is 3.13
 Taking three random samples
of size 5, we find sample means,
xത, of 3.80, 3.40 and 1.80. The sampling
error is the difference between
each xത and μ
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Sampling Distribution of the Sample Mean
 How can we determine how accurate the sample mean
is?
SAMPLING DISTRIBUTION OF THE SAMPLE MEAN A probability
distribution of all possible sample means of a given sample size.

 For a given sample size, the mean of all possible sample

means selected from a population is equal to the
population mean
 There is less variation in the distribution of the sample
mean than in the population distribution
 The sampling distribution of the sample mean tends to
become bell-shaped
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Sampling Distribution Example
Tartus Industries has seven production employees (the population).
The hourly earnings of each employee is given in the table.
1. What is the population mean?
2. What is the sampling distribution of the sample mean for
samples of size 2?
3. What is the mean of the sampling distribution?
4. What observations can be made about the population and the
sampling distribution?

Employee Hourly Earnings Employee Hourly Earnings

Joe $14 Jan 14
Sam 14 Art 16
Sue 16 Ted 18
Bob 16

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Sampling Distribution Example
Tartus Industries has seven production employees (the population).
The hourly earnings of each employee is given in the table.
1. What is the population mean?
Σx
μ = N = $15.43

Employee Hourly Earnings Employee Hourly Earnings

Joe $14 Jan 14
Sam 14 Art 16
Sue 16 Ted 18
Bob 16

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 Sampling Distribution Example
2. What is the sampling distribution of the sample mean for
samples of size 2?
Hourly Hourly
Sample Employees Earnings Sum Mean Sample Employees Earnings Sum Mean

1 Joe, Sam $14,$14 $28 $14 12 Sue, Bob 16,16 32 16

2 Joe, Sue 14,16 30 15 13 Sue, Jan 16,14 30 15

3 Joe, Bob 14,16 30 15 14 Sue, Art 16,16 32 16

4 Joe, Jan 14,14 28 14 15 Sue, Ted 16,18 34 17

5 Joe, Art 14,16 30 15 16 Bob, Jan 16,14 30 15

6 Joe, Ted 14,18 32 16 17 Bob, Art 16,16 32 16

7 Sam, Sue 14,16 30 15 18 Bob,Ted 16,18 34 17

8 Sam, Bob 14,16 30 15 19 Jan, Art 14,16 30 15

9 Sam, Jan 14,14 28 14 20 Jan, Ted 14,18 32 16

10 Sam, Art 14,16 30 15 21 Art, Ted 16,18 34 17

11 8-14 Sam, Ted 14,16

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Sampling Distribution Example
Tartus Industries has seven production employees (the population).
3. What is the mean of the sampling distribution?

Sample Mean Number of Means Probability

$14 3 .1429
15 9 .4285
16 6 .2857
17 3 .1429
21 1.0000

Sum of all sample means $324

μxഥ = = 21 =$15.43
Total number of samples

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Sampling Distribution Example
4. What observations can be made about the population
and the sampling distribution?

 The mean of the distribution of the sample mean

($15.43) is equal to the mean of the population, μ = μxഥ
 The spread in the distribution of the sample mean is less
than the spread in the population values
 The shapes of the population and sample distributions are
different

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Central Limit Theorem

THE CENTRAL LIMIT THEOREM If samples of a particular size are

selected from any population, the sampling distribution of the sample
mean is approximately a normal distribution. The approximation
improves with larger samples.

 If the population follows a normal probability distribution, then

for any sample size the sampling distribution of the sample
mean will also be normal
 If the population distribution is symmetrical, you will see the
normal shape of the distribution of the sample mean emerge
with samples as small as 10
 If the distribution is skewed or has thick tails, it may require
samples of 30 or more to observe the normality feature
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Central Limit Theorem Results

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CLT Conclusions
 The mean of the distribution of sample means will be
exactly equal to the population mean, if we select all
possible samples of same size from the population
μ = μxഥ
 The standard deviation of the sampling distribution of the
sample mean is also called the standard error of the mean

 There will be less dispersion in the sampling distribution

of the sample mean, σ/ n, than in the population σ

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Normal Distribution
 If the population follows a normal distribution, the
sampling distribution of the sample mean will also follow
the normal distribution for samples of any size
 If the population is not normally distributed, the sampling
distribution of the sample mean will approach a normal
distribution when the sample size is at least 30
 Assume the population standard deviation is known
 To determine the probability that a sample mean falls in a
particular region, use the following formula

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Using the Sampling Distribution Example
The Quality Assurance Dept. for Cola, Inc. maintains records regarding the
amount of cola in its jumbo bottle. The actual amount of cola in each bottle
varies a small amount from one bottle to another. Records indicate the
amounts of cola follow the normal distribution, the mean amount of cola in the
bottles is 31.2 ounces, and the standard deviation is 0.4 ounces. At 8 a.m. today,
the quality technician randomly selected 16 bottles from the filling line. The
mean amount was 31.38 ounces. Is this an unlikely result? Is it a likely the
process is putting too much soda in the bottle? Is the sampling error of 0.18
ounce unusual?

xഥ − μ 31.38 −31.20
z= = 0.4/ 16 = 1.80
σ/ n

We conclude that it is unlikely;

there is less than a 4% chance.
The process is putting too much
soda in the bottles.

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