Estimation of Parameters

Related Terminologies
DECRYPTING TERMINOLOGIES
• Parameter = a value or description associated to the population.
• Statistic = a value or description accorded to sample.
Cracking the Code: Estimating
Parameters with Precision
Introduction to Estimation of
Parameters
Introduction to Estimation of Parameters

•Point Estimation
•Interval Estimation
•Maximum Likelihood
Estimation
Definition
• Estimation of parameters is a statistical technique used to
estimate the values of unknown parameters in a
population based on sample data. It involves using
mathematical models and probability distributions to
infer information about the population. The process of
estimation involves making assumptions about the
population and using sample data to calculate estimates
of the unknown parameters. These estimates are then
used to make inferences about the population as a whole.
Point Estimation
• Point estimation is a method of estimation that involves
estimating a single value for an unknown parameter. This
value is called the point estimate and is calculated using
sample data and a specific statistical formula.
• The accuracy of a point estimate depends on the size and
representativeness of the sample, as well as the variability of
the population being sampled. A larger, more representative
sample will generally produce a more accurate point
estimate.
• Point Estimate = a single value estimate for a population parameter. The most unbiased point estimate of the
population mean is the sample mean
• FINDING A POINT ESTIMATE:

• ***Market investors use the number of sentences per advertisement as a measure of readability for
magazine advertisements. The following represents a random sample of the number of sentences found in
50 advertisements. Find a point estimate of the population mean
• 9 20 18 16 9 9 11 13 22 16 5 18 6 6 5 12 25
17 23 7 10 9 10 10 5 11 18 18 9 9 17 13 11 7
14 6 11 12 11 6 12 14 11 9 18 12 12 17 11 20
Solution: The sample mean of the data is:
. the point estimate for the mean length of all magazine advertisements is 12.4 sentences.
• 2. Look at the 60 bottles of coconut juice as consisting of 10 columns and 6 rows.
Compute the means of the column samples.
What is the overall mean? This value is also the an estimate of the population parameter.
Sample 1 Sample 2 Sample 3 Sample 4 Sample 5 Sample 6 Sample 7 Sample 8 Sample 9 Sample 10

500 498 497 503 499 497 497 497 497 495
500 500 495 494 498 500 500 500 500 497
497 497 502 496 497 497 497 497 497 495
501 495 500 497 497 500 500 495 497 497
502 497 497 499 496 497 497 499 500 500
496 497 496 495 497 497 500 500 496 497

500+500+ 497+501+502+ 496 2996

𝑥𝑐 1 = = =499.33
6 6
• From the give above:
1. Compute the remaining means
2. Compute the mean of the means
3. Enter your values in the following table.
4. Based on the 10 random samples, what is the point of the population mean?
Column Sum of Scores Means
1 2996 499.33
2  2984 497.33 
3  2987 497.83 
4  2984 497.33 
5  2984 497.33 
6  2988 498.00 

7  2991 498.50 
8  2983 497.16 
9  2987 497.83 
10  2981 496.83 
  Overall Mean  497.74
Confidence Intervals Unleashed
Interval Estimation

• Interval estimation is a method of

estimation that involves calculating a range
of values within which the true value of an
unknown parameter is likely to fall. This
range is called a confidence interval and is
calculated using sample data and a specific
statistical formula.
Types of Confidence Intervals
• The Z interval = used when the population standard
deviation is known or when a large sample mean is
given.
• The t – interval = used when a small sample mean and
its standard deviation are known.
• The = used when the population proportion is given.
How to Calculate Confidence Level Interval
• To calculate the confidence level interval, one needs
to determine the sample mean and standard
deviation, as well as the level of significance and
sample size.
• Finally, the margin of error is calculated by multiplying
the critical value with the standard error of the mean.
The confidence interval is then obtained by adding and
subtracting the margin of error to the sample mean.
UNLOCKING TERMINOLOGIES:

• Interval Estimate = an interval, or range of values used to estimate a population parameter. ().
Confidence Level(c) = the probability that the interval estimate contains the population mean.
Critical Values(confidence coefficients) (=z & +z) = are values that separate sample statistics that are
probable from sample statistics that are improbable or unusual.
Margin of Error or Maximum Error of Estimate or Error of Tolerance (E) = the greatest possible distance
between the point of estimate and the value of the parameter it is estimating.

Confidence Level () (Critical Values)

90% 1.645
95% 1.96
99% 2.575
This Photo by Unknown Author is licensed under CC BY-SA-NC
Constructing an Interval Estimate
For instance, if the margin of error is 2.1, and the point estimate is 12.4, then an interval estimate would be given
by 12.4 the point interval estimate are as follow: (10.3,14.5)
Example 2:
• A college admissions director wishes to estimate the mean age of all the students currently enrolled. In a
random sample of 20 students, the mean age is found to be 22.9 years. From past studies, the standard
deviation is known to be 1.5 years, and the population is normally distributed. Construct a 90% confidence
interval of the population mean age.
Solution:
Using the margin of error at the 90% confidence interval is

• The 90% confidence interval can be written as Interpretation: With 90% confidence, you can be sure that
that mean age of the students is between 22.3 and 23.5 or (22.3,23.5)
Example # 3
• 2.A random of 40 households has an average water consumption of
29 cubic meters per month. If a population standard deviation is
known to be 8 cubic meters, give the 90% confidence interval for the
mean usage of water per month.
Given:

• Interval:
Seat Work

• A study of 40 bowlers showed that their average score

was 186. The standard deviation of the population is 6.
• a. Find the 95% confidence interval of the mean score
for all the bowlers.
b. Find the 95% confidence interval of the mean score
of a sample of 100 bowlers instead of a sample of 40.
The t – interval/
Distribution
Basic Concepts about t - distribution
• Developed by William S. Gosset (1876 – 1937) who
published his work using the pseudonym Student
• It is sometimes referred to as Student’s t –
distribution.
• It is a family of curves determined by a parameter
called the degrees of freedom. Degrees of freedom
are the number of free choices left after a sample
statistic such as the is calculated. It is computed using
the formula :
Formula for the t - Distribution

•
The student’s t - distribution

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Confidence Interval for t – distribution:

Where:
Sample Problems

1. A recent study of 19 students of San

Sebastian College – Recoletos, Manila
showed that the mean of the distance they
travel to go to school was 10.2 kms. The
standard deviation of the sample was 2.3
kms. Find the 99% confidence interval of
the true mean.
Soluti:on
• Given:
• Since = 2.878.
Assignment
1. The mean score of a random sample of 22 student applicants who
took the college entrance examination is calculated to be 76.9. the
population variance is known to be 27.4. Find the 99% confidence
interval for the mean of the entire student application.
2. The average hemoglobin reading of a sample of 20 teachers was 16
grams per 100 milliliters, with a standard deviation of 2 grams. Find the
95% confidence interval of the true mean.
3. A sample of 25 two – year old chicken shows that they lay an average
of 21 eggs per month. The standard deviation of the sample was 2
eggs. Find the 99% confidence interval of the true mean.
Confused when to use Z or t? this one is for
u:
POPULATION PROPORTION
OR THE
Basic Concepts
• A proportion represents a part of a whole. Similar to probability, it can
be expressed as a percentage, decimal or fraction.
• The sample proportion, denoted by is the best point estimate of the
population proportion
• The point estimate for

= and = or
where x is the number of sample units that possess the characteristics
of interest and n is the size of the sample.
Finding Proportions for
• In a survey of 1219 Filipino adults, 354 said that their favorite sport to
watch is football. What is the proportion of Fili[pino adults who watch
football?
• In a survey of 1002 children, 252 say they eat vegetables.
• Out of 264 smokers, 204 smokers reported that they wanted to quit
smoking.
• In a survey of 1003 company employees, 662 would be happy
spending the rest of their carreer with the current employer.
Confidence interval for the population
proportion

Verifying that a the sampling distribution of can be approximated by

the normal distribution:
Constructing a Confidence Interval for
Solution for #1.
• the graph, = 0.63, then
0.041
The 99% confidence interval is: = 0.63 – 0.041 < p < 0.63 +0.041 =
0.589 < p < 0.671.
• A sample of 350 engineering applicants included 140 women. Find the
95% confidence interval of the true population of women who
applied to the engineering program.
Solution for # 2
• Given:

= 1 – 0.40 = 0.60
= 34.9% < p < 45.1%
Additional Problems
1. The municipal government wants to estimate the percent of citizens
who are willing to pay mandatory drug test. In a survey among 300
citizens, 210 of them are willing to pay for the drug test. Construct a
99%A confidence interval for the proportion of the citizens who are
willing to pay for the mandatory drug test.
2. The University Marketing Head had conducted a pre- survey of
selected students. Of 4860 randomly selected students, 2140 have
said they preferred business related courses. With 90% confidence,
what interpretation can be made regarding the probability that all
students want to enroll in business related courses?
 End of Chapter
Thank You. Happy Learning!