Exercise ( Estimation)

1. What is Estimation? Differentiate between estimator and estimate.

2. What are the main important criteria for a good estimator?

3. Develop the concept of point estimation and interval estimation.

1. A random sample of 300 first semester students of University Campus was selected from total
2500 students. The mean and standard deviation of marks in Statistics of these 300 students
were found to be 50 and 10. Find 95% confidence interval for average marks of all students.

2. The average score of 400 students taken as sample from the students appearing in CMAT
examination of BBA was found to be 60 with standard deviation 10. Construct 99.73%
confidence limit for the average score of all students appearing in that CMAT examination.

3. A sample of 500 bulbs of a company showed an average life of 1400 hours with standard
deviation of 30 hours. Obtain 95% and 99% fiducial limits for population mean. [TU 2064]

4. The mean height obtained from a sample of size 100 taken randomly from a population is 164
cm. If the standard deviation of the height distribution of the population is 3 cm, set up 95%
confidence limits for the mean height of the population.

5. The mean income of 100 employees of a factory was found to be Rs. 5,000 with standard
deviation of Rs. 60. Find 95% confidence interval for the mean income of all the employees of
the factory. [TU 2060]

6. The quality control manager at a factory manufacturing light bulbs is interested to estimate the
average life of a large shipment of light bulbs. The standard deviation is known to be 100 hours.
A random sample of 50 light bulbs gave a sample average life of 3500 hours. Set up a 95 per cent
confidence interval estimate of the true average life of light bulbs in the shipment.

7. A random sample of 500 one litre pouches of Sunflower oil of a company was selected for the
investigation. The mean and standard deviation of amount of oil per pouch calculated from
sample of these 500 pouches were found as 0.995 litre and 0.050 litre. Compute confidence
limits for the average content in a pouch for all pouches produced by the company.
 8. A random sample of 100 ball bearings selected from a shipment of 2000 ball bearings has an
average diameter of 0.354 cm with a standard deviation of 0.048 cm. Find the 95% confidence
interval for the average number of these 2000 ball bearings.

9. A random sample of 200 customers at a bank was selected for estimating the mean number of
transactions per year for each customer. The mean number of transactions calculated from the
sample was 43 per year with standard deviation 12. Determine the confidence limits for the
mean number of transaction for all customer accounts of that bank.

10. A person is interested to compute the average monthly salary of employees of NTC. He took a
random sample of 400 employees and found that the average salary was Rs. 30,000 with
standard deviation as Rs. 5,000. Calculate the 95% confidence interval for the average salary for
all the employees of NTC.

11. 400 laptops were taken as sample from a large consignment of Sony Electronics Company and
20 laptops were found to be damaged.

(a) Find the standard error of proportion of damaged laptops.

(b) Estimate 95% and 99% confidence limits for the percentage of damaged laptops in the
consignment.

12 The director of NTC is interested to compute the percentage of smokers among the employees
of NTC. He took a random sample of 400 employees and found 50 smokers in his sample.
Calculate the 99.73% confidence interval for the percentage of employees who smokes among
all the employees of NTC.

13 A survey of 400 peoples shopping at Civil Mall, selected at random, shows that 300 of them used
cash and 100 of them used credit cards. Construct a confidence interval to estimate of the
proportion of all the persons at the mall who use credit cards for shopping at Civil Mall.

14 In a sample survey of 2000 people in Kathmandu Metropolitan City, 60% people preferred Muna
Tea to other tea. Construct 99% confidence limit within which the proportion of people who
prefer Muna Tea.

15 Out of 20,000 customer’s ledger accounts, a sample of 600 accounts was taken to test the
accuracy of posting and balancing wherein 45 accounts having mistake were found.

(a) Assign limits within which the percentage of defective cases can be expected at 5% level of
significance.

(b) Assign limits within which the number of defective cases can be expected at 5% level of
significance.

16. Fit and Right Company is producing 50,000 pairs of shoes monthly. From a sample of 500 pairs
of shoes, 2% were found to be defective.
 (a) Assign limits within which the percentage of defective pair of shoes can be expected to lie at 5%
level of significance.

(b) Calculate confidence interval for the number of defective pairs of shoes in the monthly
production.

17. In a study of time and motion of factory, the supervisor estimates that the standard deviation to
be 0.95 seconds. If you want to be 95% confident that the error will not exceed 0.10 second,
what should be the size of the sample to estimate population mean? [TU 2061]

18. A researcher wants to estimate population mean by using sampling technique. What should be
the sample size when the permissible error between parameter value and sample statistic will
not be more than 1.5 with 95% confidence level and population standard deviation is 15.

19. A researcher wishes to estimate the mean of population by using sufficiently large sample. The
probability is 0.95 that sample mean will not differ from the true mean by more than 25% of the
standard deviation. How large sample should be taken?

20. How large sample should be taken to keep the risk of error being ± 5 is 0.0456? It is provided
that standard deviation is 20.

21. A manufacturing concern wants to estimate the average amount of purchase of its product in a
month by the customers. If the standard deviation is Rs. 10, find the sample size if the maximum
error is not to exceed Rs. 3 with a probability of 0.99.

22. In measuring reaction time, a psychologist estimated that standard deviation is 1.08 seconds
obtained from a random sample of size 240. What will be the sampling error with 99% level of
confidence?

23. From a sample of 400 tube light, computed mean and standard error of mean found to be 1250
hours and 25 hours respectively. What sample size should be taken to insure 99% confidence
that the population mean lies within more or less 50 of the sample mean?

24. It is desired to estimate the proportion of the junior executives who change their first job within
the first five years. This proportion is to be estimate within 3% of error and 0.95 degree of
confidence is to be used. A study revealed that 30% of such junior executives changed their first
job within 5 years.

(a) How large a sample is required to update the study?

(b) How large should be the sample if the no such previous estimates are available?

25. The principal of a college wants to estimate the proportion of smokers among his students.
What size of a sample should be selected if he does not like to have error more than 10%?
 (a) It is believed from previous records that the proportion of smokers was 0.30. (b) How large
should be the sample if there is no such previous estimates are available?

26. Colgate Toothpaste Company wishes to estimate the proportion of consumers that prefers its
herbal toothpaste with an error of not more than 0.03 and a level of confidence 98%. Sales
reports indicate that about 0.20 of all consumers prefer its toothpaste. What is the required
sample size?

27. A Unilever company of cosmetic product wishes to estimate the proportion of people who like
their product. How large sample should be taken so that there should not be error greater than
2% with risk of 4.56% given that the proportion of the people like or dislike their product is
equally likely?

28. If the population proportion of success is 0.65 and n=100, what will be the value of sampling
error when acceptance region is 0.95? [TU 2065]

29. A sample of 36 students appearing in CMAT examination yields the error 3 with standard
deviation 10. Find risk of making an error 3.

30. A sample of 80 MBS students appearing in first year examination yields the error as 4 with
standard deviation of 16.What is risk of error being 4. In the study, if the sample size is
decreased to 50, how will the risk be affected, the standard deviation, error remaining the same.

Answers

1. [48.94 – 51.06] 2. [58.50 – 61.50] 3. [1397.37 – 1402.63] and [1396.56 – 1403.44]

4. [163.41 – 164.59] 5. [4988.24 – 5011.76] 6. [3472.29 – 3527.71] 7.

8. [0.345 – 0.363] 9. [41.34≈41 – 44.66≈45] 10. [29,510 – 30,490]

11. (a) 0.0109 (b) [0.0286 – 0.0714] and [0.0220 – 0.0780] 12. [0.0755 – 0.1745]

13. [0.2075 – 0.2925] 14. [0.5717 – 0.6283] 15. (a) [5.42% – 9.58%] (b)
[1084 –1916]

16. (a) [0.78% – 3.22%] (b) [390 – 1610] 17. 347 18. 384

19. 61 20. 64 21. 73 22. 0.1792

23. 660 24. (a) 896 (b) 1067

25. (a) 81 (b) 96 26. 965 27. 2500

28. 0.093 29. 7.18% 30. 2.5%, 7.68%, increased

28. 0.093 29. 7.18% 30. 2.5%, 7.68%, increased