Central Limit Theorem

When the population from which we are selecting

a random sample does not have a normal distribution,
the central limit theorem is helpful in identifying the
shape of the sampling distribution of x .

CENTRAL LIMIT THEOREM

In selecting random samples of size n from a
population, the sampling distribution of the
sample x mean can be approximated by a
normal distribution as the sample size becomes
large.
 Sampling Distribution of x
 Example: St. Andrew’s College

Sampling
Distribution  80
of x x    14.6
n 30
for MAT
Scores

x
E( x )  1090
 Sampling Distribution of x
 Example: St. Andrew’s College
What is the probability that a simple random
sample of 30 applicants will provide an estimate of
the population mean MAT score that is within +/-10
of the actual population mean  ?
In other words, what is the probability that x will
be between 1080 and 1100?
 Sampling Distribution of x
 Example: St. Andrew’s College
Step 1: Calculate the z-value at the upper endpoint of
the interval.
z = (1100 - 1090)/14.6= .68
Step 2: Find the area under the curve to the left of the
upper endpoint.
P(z < .68) = .7517
 Sampling Distribution of x
 Example: St. Andrew’s College

Cumulative Probabilities for

the Standard Normal Distribution
z .00 .01 .02 .03 .04 .05 .06 .07 .08 .09
. . . . . . . . . . .
.5 .6915 .6950 .6985 .7019 .7054 .7088 .7123 .7157 .7190 .7224
.6 .7257 .7291 .7324 .7357 .7389 .7422 .7454 .7486 .7517 .7549
.7 .7580 .7611 .7642 .7673 .7704 .7734 .7764 .7794 .7823 .7852
.8 .7881 .7910 .7939 .7967 .7995 .8023 .8051 .8078 .8106 .8133
.9 .8159 .8186 .8212 .8238 .8264 .8289 .8315 .8340 .8365 .8389
. . . . . . . . . . .
 Sampling Distribution of x
 Example: St. Andrew’s College

Sampling
Distribution  x  14.6
of x
for MAT
Scores

Area = .7517

x
1090 1100
 Sampling Distribution of x
 Example: St. Andrew’s College
Step 3: Calculate the z-value at the lower endpoint of
the interval.
z = (1080 - 1090)/14.6= - .68
Step 4: Find the area under the curve to the left of the
lower endpoint.
P(z < -.68) = .2483
Sampling Distribution of xMAT Scores
 Example: St. Andrew’s College

Sampling
Distribution  x  14.6
of x
for MAT
Scores

Area = .2483

x
1080 1090
Sampling Distribution of x for MAT Scores
 Example: St. Andrew’s College
Step 5: Calculate the area under the curve between
the lower and upper endpoints of the interval.
P(-.68 < z < .68) = P(z < .68) - P(z < -.68)
= .7517 - .2483
= .5034
The probability that the sample mean MAT score
will
be between 1080 and 1100 is:

P(1080 < x < 1100) = .5034

Sampling Distribution of x for MAT Scores
 Example: St. Andrew’s College

Sampling
Distribution  x  14.6
of x
for MAT
Scores
Area = .5034

x
1080 1090 1100
Relationship Between the Sample Size
and the Sampling Distribution of x
 Example: St. Andrew’s College
• Suppose we select a simple random sample of 100
applicants instead of the 30 originally considered.
• E( x) = m regardless of the sample size. In our
example, E(x ) remains at 1090.
• Whenever the sample size is increased, the standard
error of the mean  x is decreased. With the increase
in the sample size to n = 100, the standard error of
the mean is decreased from 14.6 to:
 80
x    8.0
n 100
Relationship Between the Sample Size
and the Sampling Distribution of x
 Example: St. Andrew’s College

With n = 100,
x  8

With n = 30,
 x  14.6

x
E( x )  1090
Relationship Between the Sample Size
and the Sampling Distribution of x
 Example: St. Andrew’s College
• Recall that when n = 30, P(1080 < x < 1100) = .5034.
• We follow the same steps to solve for P(1080 < x
< 1100) when n = 100 as we showed earlier when
n = 30.
• Now, with n = 100, P(1080 < x < 1100) = .7888.
• Because the sampling distribution with n = 100 has a
smaller standard error, the values of x have less
variability and tend to be closer to the population
mean than the values of x with n = 30.
Relationship Between the Sample Size
and the Sampling Distribution of x
 Example: St. Andrew’s College

Sampling x  8
Distribution
of x
for MAT
Scores
Area = .7888

x
1080 1090 1100
 2.A population has a mean of 200 and a standard deviation of 50. Suppose a
sample of size 100 is selected and x is used to estimate population mean.
a. What is the probability that the sample mean will be within ±5 of the population
mean?
b. What is the probability that the sample mean will be within ±10 of the
population mean?

3. The mean preparation fee H&R Block charged retail customers last year was $183
(the Wall Street Journal, March 7, 2012). Use this price as the population mean and
assume the population standard deviation of preparation fees is $50.
a. What is the probability that the mean price for a sample of 30 H&R Block retail
customers is within $8 of the population mean?
b. What is the probability that the mean price for a sample of 50 H&R Block retail
customers is within $8 of the population mean?
c. What is the probability that the mean price for a sample of 100 H&R Block retail
customers is within $8 of the population mean?
Sampling Distribution of p
 Making Inferences about a Population Proportion

Population A simple random sample

with proportion of n elements is selected
p=? from the population.

The value of p is used The sample data

to make inferences provide a value for the
about the value of p. sample proportion .p
Sampling Distribution of p

The sampling distribution of p is the probability

distribution of all possible values of the sample
proportion p.
• Expected Value of p

E ( p)  p

where:
p = the population proportion
Sampling Distribution of p
• Standard Deviation of p
Finite Population Infinite Population

N  n p (1  p) p(1  p )
p  p 
N 1 n n

•  p is referred to as the standard error of

the proportion.
• is the finite population
( N  n) / ( N  1)
correction factor.
Form of the Sampling Distribution of p

The sampling distribution ofp can be approximated

by a normal distribution whenever the sample size
is large enough to satisfy the two conditions:

np > 5 and n(1 – p) > 5

. . . because when these conditions are satisfied, the

probability distribution of x in the sample proportion,
p = x/n, can be approximated by normal distribution
(and because n is a constant).
Sampling Distribution of p
 Example: St. Andrew’s College
Recall that 72% of the prospective students applying
to St. Andrew’s College desire on-campus housing.
What is the probability that a simple random sample
of 30 applicants will provide an estimate of the
population proportion of applicant desiring on-campus
housing that is within plus or minus .05 of the actual
population proportion?
Sampling Distribution of p
 Example: St. Andrew’s College
For our example, with n = 30 and p = .72, the
normal distribution is an acceptable approximation
because:

np = 30(.72) = 21.6 > 5

and
n(1 - p) = 30(.28) = 8.4 > 5
Sampling Distribution of p
 Example: St. Andrew’s College

Sampling .72(1  .72)

Distribution p   .082
30
of p

p
E( p )  .72
Sampling Distribution of p
 Example: St. Andrew’s College
Step 1: Calculate the z-value at the upper endpoint
of the interval.
z = (.77 - .72)/.082 = .61
Step 2: Find the area under the curve to the left of
the upper endpoint.
P(z < .61) = .7291
 Sampling Distribution of p
 Example: St. Andrew’s College
Cumulative Probabilities for
the Standard Normal Distribution
z .00 .01 .02 .03 .04 .05 .06 .07 .08 .09
. . . . . . . . . . .
.5 .6915 .6950 .6985 .7019 .7054 .7088 .7123 .7157 .7190 .7224
.6 .7257 .7291 .7324 .7357 .7389 .7422 .7454 .7486 .7517 .7549
.7 .7580 .7611 .7642 .7673 .7704 .7734 .7764 .7794 .7823 .7852
.8 .7881 .7910 .7939 .7967 .7995 .8023 .8051 .8078 .8106 .8133
.9 .8159 .8186 .8212 .8238 .8264 .8289 .8315 .8340 .8365 .8389
. . . . . . . . . . .
Sampling Distribution of p
 Example: St. Andrew’s College

Sampling  p  .082
Distribution
of p

Area = .7291

p
.72 .77
Sampling Distribution of p
 Example: St. Andrew’s College
Step 3: Calculate the z-value at the lower endpoint of
the interval.
z = (.67 - .72)/.082 = - .61
Step 4: Find the area under the curve to the left of the
lower endpoint.
P(z < -.61) = .2709
Sampling Distribution of p
 Example: St. Andrew’s College

Sampling  p  .082
Distribution
of p

Area = .2709

p
.67 .72
Sampling Distribution of p
 Example: St. Andrew’s College
Step 5: Calculate the area under the curve between
the lower and upper endpoints of the interval.
P(-.61 < z < .61) = P(z < .61) - P(z < -.61)
= .7291 - .2709
= .4582
The probability that the sample proportion of applicants
wanting on-campus housing will be within +/-.05 of the
actual population proportion :

P(.67 < p < .77) = .4582

Sampling Distribution of p
 Example: St. Andrew’s College

Sampling  p  .082
Distribution
of p

Area = .4582

p
.67 .72 .77
A population proportion is .40. A sample of size 200 will be taken and the sample
proportion p will be used to estimate the population proportion.
a. What is the probability that the sample proportion will be within ±.03 of the
population proportion?
b. What is the probability that the sample proportion will be within ±.05 of the
population proportion?
 Properties of Point Estimators
 Before using a sample statistic as a point estimator,
statisticians check to see whether the sample statistic has
the following properties associated with good point
estimators.
• Unbiased
• Efficiency
• Consistency
 Properties of Point Estimators
 Unbiased
If the expected value of the sample statistic is equal to
the population parameter being estimated, the sample
statistic is said to be an unbiased estimator of the
population parameter.
 Properties of Point Estimators
 Efficiency
Given the choice of two unbiased estimators of the
same population parameter, we would prefer to use the
point estimator with the smaller standard deviation, since
it tends to provide estimates closer to the population
parameter.
The point estimator with the smaller standard
deviation is said to have greater relative efficiency than
the other.
 Properties of Point Estimators
 Consistency
A point estimator is consistent if the values of the
point estimator tend to become closer to the population
parameter as the sample size becomes larger.
In other words, a large sample size tends to provide a
better point estimate than a small sample size.
 Other Sampling Methods
 Stratified Random Sampling
 Cluster Sampling
 Systematic Sampling
 Convenience Sampling
 Judgment Sampling
Stratified Random Sampling

The
The population
population is
is first
first divided
divided into
into groups
groups of
of
elements
elements called
called strata.
strata.

Each
Each element
element in
in the
the population
population belongs
belongs to
to one
one and
and
only
only one
one stratum.
stratum.

Best
Best results
results are
are obtained
obtained when
when the
the elements
elements within
within
each
each stratum
stratum are
are as
as much
much alike
alike as
as possible
possible
(i.e.
(i.e. aa homogeneous
homogeneous group).
group).
Stratified Random Sampling

A
A simple
simple random
random sample
sample is
is taken
taken from
from each
each stratum.
stratum.

Formulas
Formulas are
are available
available for
for combining
combining the
the stratum
stratum
sample
sample results
results into
into one
one population
population parameter
parameter
estimate.
estimate.

Advantage:
Advantage: If If strata
strata are
are homogeneous,
homogeneous, this
this method
method
is
is as
as “precise”
“precise” as
as simple
simple random
random sampling
sampling but
but with
with
aa smaller
smaller total
total sample
sample size.
size.

Example:
Example: The
The basis
basis for
for forming
forming the
the strata
strata might
might be
be
department,
department, location,
location, age,
age, industry
industry type,
type, and
and so
so on.
on.
Cluster Sampling

The
The population
population is
is first
first divided
divided into
into separate
separate groups
groups
of
of elements
elements called
called clusters.
clusters.

Ideally,
Ideally, each
each cluster
cluster is
is aa representative
representative small-scale
small-scale
version
version of
of the
the population
population (i.e.
(i.e. heterogeneous
heterogeneous group).
group).

A
A simple
simple random
random sample
sample of
of the
the clusters
clusters is
is then
then taken.
taken.

All
All elements
elements within
within each
each sampled
sampled (chosen)
(chosen) cluster
cluster
form
form the
the sample.
sample.
Cluster Sampling

Example:
Example: A A primary
primary application
application is
is area
area sampling,
sampling,
where
where clusters
clusters are
are city
city blocks
blocks or
or other
other well-defined
well-defined
areas.
areas.

Advantage:
Advantage: The The close
close proximity
proximity of
of elements
elements can
can be
be
cost
cost effective
effective (i.e.
(i.e. many
many sample
sample observations
observations can
can be
be
obtained
obtained inin aa short
short time).
time).

Disadvantage:
Disadvantage: This
This method
method generally
generally requires
requires aa
larger
larger total
total sample
sample size
size than
than simple
simple or
or stratified
stratified
random
random sampling.
sampling.
Systematic Sampling

If
If aa sample
sample size
size of
of nn is
is desired
desired from
from aa population
population
containing
containing N N elements,
elements, we we might
might sample
sample one
one
element
element for
for every
every n/N
n/N elements
elements in
in the
the population.
population.

We
We randomly
randomly select
select one
one ofof the
the first
first n/N
n/N elements
elements
from
from the
the population
population list.
list.

We
We then
then select
select every
every n/Nth
n/Nth element
element that
that follows
follows in
in
the
the population
population list.
list.
Systematic Sampling

This
This method
method hashas the
the properties
properties ofof aa simple
simple random
random
sample,
sample, especially
especially ifif the
the list
list of
of the
the population
population
elements
elements is
is aa random
random ordering.
ordering.

Advantage:
Advantage: TheThe sample
sample usually
usually will
will be
be easier
easier to
to
identify
identify than
than itit would
would be
be ifif simple
simple random
random sampling
sampling
were
were used.
used.

Example:
Example: Selecting
Selecting every
every 100
100thth listing
listing in
in aa telephone
telephone
book
book after
after the
the first
first randomly
randomly selected
selected listing
listing
Convenience Sampling

It
It is
is aa nonprobability
nonprobability sampling
sampling technique.
technique. Items
Items are
are
included
included in in the
the sample
sample without
without known
known probabilities
probabilities
of
of being
being selected.
selected.

The
The sample
sample is
is identified
identified primarily
primarily by
by convenience.
convenience.

Example:
Example: AA professor
professor conducting
conducting research
research might
might use
use
student
student volunteers
volunteers to
to constitute
constitute aa sample.
sample.
Convenience Sampling

Advantage:
Advantage: Sample
Sample selection
selection and
and data
data collection
collection are
are
relatively
relatively easy.
easy.

Disadvantage:
Disadvantage: ItIt is
is impossible
impossible to
to determine
determine how
how
representative
representative of
of the
the population
population the
the sample
sample is.
is.
Judgment Sampling

The
The person
person most
most knowledgeable
knowledgeable onon the
the subject
subject of
of the
the
study
study selects
selects elements
elements of
of the
the population
population that
that he
he or
or
she
she feels
feels are
are most
most representative
representative of
of the
the population.
population.

It
It is
is aa nonprobability
nonprobability sampling
sampling technique.
technique.

Example:
Example: A A reporter
reporter might
might sample
sample three
three or
or four
four
senators,
senators, judging
judging them
them as
as reflecting
reflecting the
the general
general
opinion
opinion of
of the
the senate.
senate.
Judgment Sampling

Advantage:
Advantage: It
It is
is aa relatively
relatively easy
easy way
way of
of selecting
selecting aa
sample.
sample.

Disadvantage:
Disadvantage: The
The quality
quality of
of the
the sample
sample results
results
depends
depends on
on the
the judgment
judgment of
of the
the person
person selecting
selecting the
the
sample.
sample.
Recommendation

It
It is
is recommended
recommended that
that probability
probability sampling
sampling methods
methods
(simple
(simple random,
random, stratified,
stratified, cluster,
cluster, or
or systematic)
systematic) be
be
used.
used.

For
For these
these methods,
methods, formulas
formulas are
are available
available for
for
evaluating
evaluating the
the “goodness”
“goodness” of
of the
the sample
sample results
results in
in
terms
terms of
of the
the closeness
closeness of
of the
the results
results to
to the
the population
population
parameters
parameters being
being estimated.
estimated.

An
An evaluation
evaluation of
of the
the goodness
goodness cannot
cannot be
be made
made with
with
non-probability
non-probability (convenience
(convenience or
or judgment)
judgment) sampling
sampling
methods.
methods.