Session - 8-Sampling Distribution

Session – 8 (Sampling and Sampling Distribution)
Chapter 7
A sample mean provides an estimate of a population mean, and a sample proportion provides an estimate
of a population proportion. With estimates such as these, some estimation error can be expected. Objective
is to provide the basis for determining how large that error might be.
The sampled population is the population from which the sample is drawn, and a frame is a list of the
elements that the sample will be selected from. Numerical characteristics of a population are called
parameters.
Selecting a Sample
Sampling from a Finite Population
Sampling from an Infinite Population
Consider the population of customers arriving at a fast-food restaurant. Suppose an employee is asked to
select and interview a sample of customers in order to develop a profile of customers who visit the
restaurant.
The number of different simple random samples of size n that can be selected from a finite population of
size N is
EAI Case – datafile (EAI .xls) – 2500 (mean, SD)

Point Estimation
A simple random sample of 30 managers and the corresponding data on annual
salary and management training program participation. The notation x1, x2, and so on is used to denote the
annual salary of the first manager in the sample, the annual salary of the second manager in the sample, and
so on. Participation in the management training program is indicated by Yes in the management training
program column.
To estimate the population, mean μ and the population standard deviation σ for the annual salary of EAI
managers
sample mean and the sample standard deviation s.
To estimate p, the proportion of managers in the population who completed the management training
program, we use the corresponding sample proportion. Let x denote the number of managers in the sample
who completed the management training program. The data in Table 7.2 show that x = 19. Thus, with a
sample size of n = 30, the sample proportion is
The numerical value obtained for , s, or is called the point estimate.

The point estimates differ somewhat from the corresponding population parameters. This difference is to
be expected because a sample, and not a census of the entire population, is being used to develop the
point estimates.
In summary, whenever a sample is used to make inferences about a population, we should make sure that
the study is designed so that the sampled population and the target population are in close agreement.
Good judgment is a necessary ingredient of sound statistical practice.
Introduction to Sampling Distributions
sample mean is the point estimator of the population mean μ, and the sample proportion is the point
estimator of the population proportion p. Now, suppose we repeat the process of selecting a simple
random sample of 30 EAI managers over and over again, each time computing the values of
Because the various possible values of are the result of different simple random samples, the probability
distribution of is called the sampling distribution

Knowledge of this sampling distribution and its properties will enable us to make probability statements
about how close the sample mean is to the population mean μ.
Pop size = 2500 (mean, SD) →
We note that the largest concentration of the values and the mean of the 500 values is near the population
mean μ = $51,800.
If every possible sample of size 30 were selected from the population and if a value of were computed for
each sample, the resulting probability distribution would be the sampling distribution of
In practice, we select only one simple random sample from the population. We repeated the sampling
process 500 times in this section simply to illustrate that many different samples are possible and that the
different samples generate a variety of values for the sample statistics The probability
distribution of any particular sample statistic is called the sampling distribution of the statistic.
Sampling Distribution of
When the expected value of a point estimator (500 times sample mean) equals the population parameter
(2500), we say the point estimator is unbiased.
Standard Deviation of
we see that the factor is required for the finite population case but not for the
infinite population case. This factor is commonly referred to as the finite population correction factor. In
many practical sampling situations, we find that the population involved, although finite, is “large,” whereas
the sample size is relatively “small.” In such cases the finite population correction factor is close to 1.
To further emphasize the difference between we refer to the standard deviation of

as the standard error of the mean.
In general, the term standard error refers to the standard deviation of a point estimator. Later we will see
that the value of the standard error of the mean is helpful in determining how far the sample mean may be
from the population mean.
Form of the Sampling Distribution of

Population has a normal distribution. When the population has a normal distribution, the sampling
distribution of is normally distributed for any sample size.
Population does not have a normal distribution.
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
How the central limit theorem works for three different populations; each column refers to one of the
populations. The top panel of the figure shows that none of the populations are normally distributed.
Population I follows a uniform distribution.

Population II is often called the rabbit-eared distribution. It is symmetric.
Population III is shaped like the exponential distribution; it is skewed to the right.
For samples of size 30, the shapes of each of the three sampling distributions are approximately normal.
Mangers – acceptable level 500 ab value around mean. EAI (30)
EAI Case:
Mean annual salary for the population of EAI managers is μ = $51,800. Thus, according to equation (7.1), the
mean of all possible sample means for the EAI study E(X) = $51,800.
the standard deviation of annual salary for the population of 2500 EAI managers is σ = 4000.
In this case, the population is finite, with N = 2500. However, with a sample size of 30, we have n/N = 30/2500
= .012. Because the sample size is less than 5% of the population size, we can ignore the finite population
correction factor and use equation (7.3) to compute the standard error.
Practical Value of the Sampling Distribution of

The area under the curve 0.5034. The sampling distribution of can be used to provide probability
information about how close the sample mean is to the population mean μ.
Area under the curve = 0. 7888.
Thus, by increasing the sample size from 30 to 100 EAI managers, we increase the probability of obtaining a
sample mean within $500 of the population mean from .5034 to 0.7888.
The important point in this discussion is that as the sample size is increased, the standard error of the
mean decreases.
As a result, the larger sample size provides a higher probability that the sample mean is within a specified
distance of the population mean.

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Session – 8 (Sampling and Sampling Distribution)

Sampling from an Infinite Population

EAI Case – datafile (EAI .xls) – 2500 (mean, SD)

sample mean and the sample standard deviation s.

The numerical value obtained for , s, or is called the point estimate.

Introduction to Sampling Distributions

distribution of is called the sampling distribution

To further emphasize the difference between we refer to the standard deviation of

Form of the Sampling Distribution of

distribution of is normally distributed for any sample size.

Population does not have a normal distribution.

Population I follows a uniform distribution.

Practical Value of the Sampling Distribution of

Area under the curve = 0. 7888.

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