Business statistics Chapter One Sampling & Sampling distribution

CHAPTER ONE
SAMPLING AND SAMPLING DISTRIBUTIONS

3.1. Introduction
Usually the population under study is very large or infinite which makes studding it very
difficult or impossible. Under such circumstances we take a sample or a subset of the
population to study the population.

Census and Sample Method

Under the census or complete enumeration survey method, data are collected for each and
every unit (person, household, field, shop, factory etc.), as the case may be of the
population or universe, which is the complete set of items, which are of interest in any
particular situation. For example, if the average wage of workers working in sugar
industry. Average is to be calculated, then wage figures would be obtained from each and
every worker working in the sugar industry and by dividing the total wages which all
these workers receive by the number of workers working in sugar industry, we would get
the figure of average wage

The universe may be either finite or infinite.

A finite universe is one in which the number of items is determinable, such as the
number of students in Wollo University or in Ethiopia.
An infinite universe is that in which the number of items can not be determined, such as
the number of stars in the sky. In some cases, the universe is so large that for all practical
purposes it is regarded as infinite, such as, the number of leaves on a tree.

What is sampling?
Data is collected from target population using survey. If a survey covers all population,
the survey is called census and if the survey covers part of the population, the survey is
called sampling.
Why sampling is preferable?
➢ Cheaper than census
➢ Takes smaller time as compared to census
➢ Economy of efforts as relatively fewer staffs are needed
➢ More detailed information can be collected using sample
➢ Better quality of interviewing, supervision and other related activities

What are the Essentials of Sampling?

i. Representativeness: A sample should be so selected that it truly represents the
universe otherwise the results obtained may be misleading. To ensure representative ness
the random method of selection should be used.

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ii. Adequacy: The size of sample should be adequate; otherwise it may not represent the
characteristics of the universe.
iii. Independence: All items of the sample should be selected independently of one
another and all items of the universe should have the same chance of being selected in the
sample. By independence of selection we mean that the selection of a particular item in
one draw has no influence on the probabilities of selection in any other draw.
iv. Homogeneity: When we talk of homogeneity we mean that there is no basic
difference in the nature of units of the universe and that of the sample. If two samples
from the same universe are taken, they should give more or less the same unit.

3.2. Limitations of sampling

➢ It fails to provide information on individual account
➢ Sampling gives rise to certain errors
➢ Difficult to check for omissions of certain units
Parameter and Statistic
When mean, median and mode and standard deviations are used to describe the
characteristics of a sample, it is called statistics and when they are used to describe the
population they are referred to as parameter.
Population Sample
Parameters Statistics
Population size N Sample size n
Population mean μ Sample mean X
Population standard deviation σ Sample standard deviation s
Population proportion π Sample proportion p

One of the objectives of sample survey is to estimate certain population parameters. A

point to know is that the true value of a population is parameter is unknown constant. It
can be determined only by complete study of the population. The concept of statistical
inference comes in to play whenever this is impossible or practically not feasible. A
statistic which is sample based quantity must serve as our source of information about the
value of parameter. In this context, there are three crucial points.
❖ As the sample is only part of the population, the numerical value of a statistics is
normally not expected to give us the correct value of the parameter.
❖ Since different samples can be drawn from particular population, the observed value
of the statistic depends on the particular sample that is chosen.
❖ The value of statistic will have some variability over different occasions of sample.

3.3 Importance of sampling theory

When undertaking any survey, it is essential that you obtain data from people that are as
representative as possible of the group that you are studying. Even with the perfect
questionnaire (if such a thing exists), your survey data will only be regarded as useful if it

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is considered that your respondents are typical of the population as a whole. For this
reason, an awareness of the principles of sampling is essential to the implementation of
most methods of research, both quantitative and qualitative.

• Population The group of people, items or units under investigation

• Census Obtained by collecting information about each member of a population
• Sample Obtained by collecting information only about some members of a
"population"
• Sampling Frame The list of people from which the sample is taken. It should be
comprehensive, complete and up-to-date. Examples of sampling frame: Electoral
Register; Postcode Address File; telephone book

3.4 Probability (Random) and Non-Probability (non-random) Sampling

A probability sample is one in which each member of the population has an equal chance
of being selected. A random sample is usually representative sample. There are two
methods of ensuring randomness: the lottery method and the use of random numbers.

In the lottery method, each unit of the population is numbered and shown on a chit of
paper or disc. The chits are then folded and put in a box from which a sample of
predetermined number is to be drawn.

In random number case, table of random numbers is used. The units of population are
numbered from 1 to N from which n units are selected.

In a non-probability sample, some people have a greater, but unknown, chance than
others of selection.

3.4.1 Probability Samples

There are five main types of probability sample. The choice of these depends on nature of
research problem, the availability of a good sampling frame, money, time, desired level
of accuracy in the sample and data collection methods. Each has its advantages, each its
disadvantages. They are:
• Simple random
• Systematic
• Random route
• Stratified
• Multi-stage cluster sampling

1. Simple random sample

This is perhaps an unfortunate term, because it isn't that simple and it isn't done at
random, in the sense of "haphazardly".
Characteristics:
• Each person has same chance as any other of being selected

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• Standard against which other methods are sometimes evaluated

• Suitable where population is relatively small and where sampling frame is
complete and up-to-date
Procedure:
1. Obtain a complete sampling frame
2. Give each case a unique number, starting at one
3. Decide on the required sample size
4. Select that many numbers from a table of random numbers or using computer

The possible samples of size two from the B, C, D & E population are BC, BD, CD, CE,
DE.
Note that, B appears in three of the six samples: so the probability of B, being selected is
p (B) = 3/6 = ½. Similarly, p(C) = p (D) = p (E) = ½: so (1.) each element of the
population has the same chance of being chosen. More over, (2) each of the possible
samples of size two has the same chance [p (BC) = p (BD) = p (BE) = p (CD) = P (CE) =
p (DE) = 1/6], of being selected. Consequently, we can say the conditions are satisfied.

2. Systematic sampling
Similar to simple random sampling, but instead of selecting random numbers from tables,
you move through list (sample frame) picking every kth name where k is N/n.

You must first work out sampling fraction by dividing population size by required sample
size. E.g. for a population of 500 and a sample of 100, the sampling fraction is 1/5 i.e.
you will select one person out of every five in the population. Random number needs to
be used only to decide on starting point. With the sampling fraction of 1/5, the starting
point must be within the first 5 people in your list

Disadvantage: Effect of periodicity (bias caused by particular characteristics arising in

the sampling frame at regular units). An example of this would occur if you used a
sampling frame of adult residents in an area composed of predominantly couples or
young families. If this list was arranged: Husband / Wife / Husband / Wife etc. and if
every tenth person was to be interviewed, there would be an increased chance of males
being selected.

3. Random Route Sampling

Used in market research surveys - mainly for sampling households, shops, garages and
other premises in urban areas .

Address is selected at random from sampling frame (usually electoral register) as a

starting point, interviewer then given instructions to identify further addresses by taking
alternate left- and right-hand turns at road junctions and calling at every nth address
(shop, garage etc.)

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Advantages:
• May be saving in time
• Bias may be reduced because interviewer has to call at clearly defined addresses -
not able to choose
Problems:
• Characteristics of particular areas (e.g. poor / rich) may mean that sample is not
representative
• Open to abuse by interviewer because difficult to check that instructions fully
carried out

4. Stratified Sampling
Dividing a population into non overlapping groups is called stratification. A stratified
random sampling is one where the population you have is divide into non overlapping
sub groups or strata & then a simple random sample is selected with in each of the strata
or sub groups. Thus a population can be stratified if they have readily identifiable
characteristics that can be used to separate the population members into sub groups.
For example, we can stratify a human population as follows: first we can divide the
population into different strata on the basis of age, sex, occupations, education, religion,
region, etc… you have to notice that stratification doesn’t mean absence of randomness.
But all that it means, the population is first divided into a certain strata & then a simple
random sample is selected from each stratum of the population. The advantages of using
stratified random sapling are:
➢ It more accurately reflects the characteristics of the population than simple
random sampling & systematic random sampling.
➢ It is more cost effective than simple random sampling.

5. Multi-stage cluster sampling

As the name implies, this involves drawing several different samples. It does so in such a
way that cost of final interviewing is minimized.
Basic procedure: First draw sample of areas. Initially large areas selected then
progressively smaller areas within larger area are sampled. Eventually end up with
sample of households and use method of selecting individuals from these selected
households.

3.4.2 Non-Probability Samples

It isn't always possible to undertake a probability method of sampling, such as in random
sampling. For example, there is not a complete sampling frame available for certain
groups of the population e.g. the elderly; people who are attending a football match;
people who shop in a particular part of town. Another factor to bear in mind is that many
of the probability sampling methods described above may mean that researchers would
have to undertake a postal or telephone survey delivery or might be expected to go from
house to house. We will discuss some of the problems of low response rate later on in this

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workbook, but you might find that a probability sample with a poor response rate doesn't
in the end give you a particularly good representation of the population being examined.

Advantages of non-probability methods:

• Cheaper
• Used when sampling frame is not available
• Useful when population is so widely dispersed that cluster sampling would not be
efficient
• Often used in exploratory studies, e.g. for hypothesis generation
• Some research not interested in working out what proportion of population gives a
particular response but rather in obtaining an idea of the range of responses on
ideas that people have.

1. Purposive Sampling
A purposive sample is one, which is selected by the researcher subjectively. The
researcher attempts to obtain sample that appears to him/her to be representative of the
population and will usually try to ensure that a range from one extreme to the other is
included.

Often used in political polling - districts chosen because their pattern has in the past
provided good idea of outcomes for whole electorate.

2. Quota Sampling
Quota sampling involves the fixation of certain quotas, which are to be fulfilled by the
interviewers.

Quota sampling is often used in market research. Interviewers are required to find cases
with particular characteristics. They are given quota of particular types of people to
interview and the quotas are organized so that final sample should be representative of
population.

Stages:
• Decide on characteristic of which sample is to be representative, e.g. age
• Find out distribution of this variable in population and set quota accordingly. E.g.
if 20% of population is between 20 and 30, and sample is to be 1,000 then 200 of
sample (20%) will be in this age group

Complex quotas can be developed so that several characteristics (e.g. age, sex, marital
status) are used simultaneously. By the end of the day, the researcher may be looking for
a widowed man in his nineties who looks as though he might buy a particular brand of
detergent.

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Disadvantage of quota sampling - Interviewers choose who they like (within above
criteria) and may therefore select those who are easiest to interview, so bias can result.
Also, impossible to estimate accuracy (because not random sample)

3. Convenience sampling
A convenience sample is used when you simply stop anybody in the street who is
prepared to stop, or when you wander round a business, a shop, a restaurant, a theatre or
whatever, asking people you meet whether they will answer your questions. In other
words, the sample comprises subjects who are simply available in a convenient way to
the researcher. There is no randomness and the likelihood of bias is high. You can't draw
any meaningful conclusions from the results you obtain.

However, this method is often the only feasible one, particularly for students or others
with restricted time and resources, and can legitimately be used provided its limitations
are clearly understood and stated.

Because it is an extremely haphazard approach, students are often tempted to use the
word "random" when describing their sample where they have stopped people in the
street, as they see it "at random". You should avoid using the word "random" when
describing anything to do with sampling unless you are absolutely certain that you
selected respondents from a sampling frame using truly random methods.

4. Snowball sampling
With this approach, you initially contact a few potential respondents and then ask them
whether they know of anybody with the same characteristics that you are looking for in
your research. For example, if you wanted to interview a sample of vegetarians / cyclists /
people with a particular disability / people who support a particular political party etc.,
your initial contacts may well have knowledge (through e.g. support group) of others.

5. Self-selection
Self-selection is perhaps self-explanatory. Respondents themselves decide that they
would like to take part in your survey.

3.5 Bias and Error in Sampling

A sample is expected to mirror the population from which it comes; however, there is no
guarantee that any sample will be precisely representative of the population from which it
comes. Chance may dictate that a disproportionate number of untypical observations will
be made like for the case of testing fuses, the sample of fuses may consist of more or less
faulty fuses than the real population proportion of faulty cases. In practice, it is rarely
known when a sample is unrepresentative and should be discarded.

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Sampling error
What can make a sample unrepresentative of its population? One of the most frequent
causes is sampling error.

Sampling error comprises the differences between the sample and the population that are
due solely to the particular units that happen to have been selected.

For example, suppose that a sample of 100 Arbaminch women are measured and are all
found to be taller than six feet. It is very clear even without any statistical prove that this
would be a highly unrepresentative sample leading to invalid conclusions. This is a very
unlikely occurrence because naturally such rare cases are widely distributed among the
population. But it can occur. Luckily, this is a very obvious error and can be detected
very easily.

The more dangerous error is the less obvious sampling error against which nature offers
very little protection. An example would be like a sample in which the average height is
overstated by only one inch or two rather than one foot which is more obvious. It is the
unobvious error that is of much concern.

There are two basic causes for sampling error. One is chance: That is the error that occurs
just because of bad luck. This may result in untypical choices. Unusual units in a
population do exist and there is always a possibility that an abnormally large number of
them will be chosen. The main protection against this kind of error is to use a large
enough sample. The second cause of sampling error is sampling bias.

Sampling bias is a tendency to favour the selection of units that have particular
characteristics. Sampling bias is usually the result of a poor sampling plan. The most
notable is the bias of non-response when for some reason some units have no chance of
appearing in the sample. For example, take a hypothetical case where a survey was
conducted recently by a Graduate School to find out the level of stress that graduate
students were going through. A mail questionnaire was sent to 100 randomly selected
graduate students. Only 52 responded and the results were that students were not under
stress at that time when the actual case was that it was the highest time of stress for all
students except those who were writing their thesis at their own pace. Apparently, this is
the group that had the time to respond. The researcher who was conducting the study
went back to the questionnaire to find out what the problem was and found that all those
who had responded were third and fourth PhD. students. Bias can be very costly and has
to be guarded against as much as possible. A means of selecting the units of analysis
must be designed to avoid the more obvious forms of bias. Another example would be
where you would like to know the average income of some community and you decide to
use the telephone numbers to select a sample of the total population in a locality where

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only the rich and middle class households have telephone lines. You will end up with
high average income, which will lead to the wrong policy decisions.

Non-sampling error (measurement error)

The other main cause of unrepresentative samples is non-sampling error. This type of
error can occur whether a census or a sample is being used. Like sampling error, non-
sampling error may either be produced by participants in the statistical study or be an
innocent by product of the sampling plans and procedures.

A non-sampling error is an error that results solely from the manner in which the
observations are made.

The simplest example of non-sampling error is inaccurate measurements due to

malfunctioning instruments or poor procedures. For example, consider the observation of
human weights. If persons are asked to state their own weights themselves, no two
answers will be of equal reliability. The people will have weighed themselves on
different scales in various states of poor calibration. An individual’s weight fluctuates by
several pounds, so that the time of weighing will affect the answer. The scale reading will
also vary with the person’s state of understanding. Responses therefore will not be of
comparable validity unless all persons are weighed under the same circumstances.

Biased observations due to inaccurate measurement can be innocent but very devastating.
A story is told of a French astronomer who once proposed a new theory based on
spectroscopic measurements of light emitted by a particular star. When his colloquies
discovered that the measuring instrument had been contaminated by cigarette smoke, they
rejected his findings.

In surveys of personal characteristics, unintended errors may result from: -The manner in
which the response is elicited -The social desirability of the persons surveyed -The
purpose of the study -The personal biases of the interviewer or survey writer.

The interviewer’s effect

No two interviewers are alike and the same person may provide different answers to
different interviewers. The manner in which a question is formulated can also result in
inaccurate responses. Individuals tend to provide false answers to particular questions.
For example, some people want to feel younger or older for some reason known to them.
If you ask such a person their age in years, it is easier for the individual just to lie to you
by over stating their age by one or more years than it is if you asked which year they
were born since it will require a bit of quick arithmetic to give a false date and a date of
birth will definitely be more accurate.

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The respondent effect

Respondents might also give incorrect answers to impress the interviewer. This type of
error is the most difficult to prevent because it results from out right deceit on the part of
the respondent. It is important to acknowledge that certain psychological factors induce
incorrect responses and great care must be taken to design a study that minimizes their
effect.
Knowing the study purpose
Knowing why a study is being conducted may create incorrect responses. A classic
example is the question: What is your income? If a government agency is asking, a
different figure may be provided than the respondent would give on an application for a
home mortgage. One way to guard against such bias is to camouflage the study’s goals;
another remedy is to make the questions very specific, allowing no room for personal
interpretation. For example, "Where are you employed?" could be followed by "What is
your salary?" and "Do you have any extra jobs?" A sequence of such questions may
produce more accurate information.

Selecting the Sample

The preceding section has covered the most common problems associated with statistical
studies. The desirability of a sampling procedure depends on both its vulnerability to
error and its cost. However, economy and reliability are competing ends, because, to
reduce error often requires an increased expenditure of resources. Of the two types of
statistical errors, only sampling error can be controlled by exercising care in determining
the method for choosing the sample. The previous section has shown that sampling error
may be due to either bias or chance. The chance component (sometimes called random
error) exists no matter how carefully the selection procedures are implemented, and the
only way to minimize chance-sampling errors is to select a sufficiently large sample
(sample size is discussed towards the end of this tutorial). Sampling bias on the other
hand may be minimized by the wise choice of a sampling procedure.

3.6. SAMPLING DISTRIBUTIONS

A sampling distribution is a probability distribution for the possible values of a
sample statistic, such as a sample mean.
NOTE: The normal probability distribution is used to determine probabilities for
the normally distributed individual measurements, given the mean and the
standard deviation. Symbolically, the variable is the measurement X, with the
population mean µ and population standard deviation δ. In contrast to such
distributions of individual measurements, a sampling distribution is a
probability distribution for the possible values of a sample statistic.

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Sampling Distribution of the Mean

The sampling distribution of the mean is the probability distributions of the
means, X of all simple random samples of a given sample size n that can be
drawn from the population.
NB: the sampling distribution of the mean is not the sample distribution, which
is the distribution of the measured values of X in one random sample. Rather, the
sampling distribution of the mean is the probability distribution for X , the
sample mean.
For any given sample size n taken from a population with mean µ and standard
deviation δ, the value of the sample mean X would vary from sample to sample
if several random samples were obtained from the population. This variability
serves as the basis for sampling distribution.
The sampling distribution of the mean is described by two parameters: the
expected value ( X ) = X , or mean of the sampling distribution of the mean, and
the standard deviation of the mean  x , the standard error of the mean.
Properties of the Sampling Distribution of Means
1. The mean of the sampling distribution of the means is equal to the

population mean. µ= X = X .
2. the standard deviation of the sampling distribution of the means
(standard error) is equal to the population standard deviation divided by
the square root of the sample size:  x = δ/√n. This hold true if and only
of n<0.05N and N is very large. If N is finite and n≥ 0.05N,

x = *
N −n
. The expression N − n is called finite population
n N −1 N −1
correction factor/finite population multiplier. In the calculation of the
standard error of the mean, if the population standard deviation δ is
unknown, the standard error of the mean  x , can be estimated by using
the sample standard error of the mean S X which is calculated as follows:
S N −n
SX = S or S X =* .
n n N −1
3. The sampling distribution of means is approximately normal for
sufficiently large sample sizes (n≥ 30).

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Example:
A population consists of the following ages: 10, 20, 30, 40, and 50. A random
sample of three is to be selected from this population and mean computed.
Develop the sampling distribution of the mean.

Solution:
The number of simple random samples of size n that can be drawn without
replacement from a population of size N is NCn. With N= 5 and n = 3, 5C3 = 10
samples can be drawn from the population as:
Sampled items Sample means ( X )
10, 20, 30 20.00
10, 20, 40, 23.33
10, 20, 50 26.67
10, 30, 40 26.67
10, 30, 50 30.00
10, 40, 50 33.33
20, 30, 40 30.00
20, 30, 50 33.33
20, 40, 50 36.67
30, 40, 50 40.00
300.00

A systematic organization of the above figures gives the following:

Sample mean ( X ) Frequency Prob. (relative freq.) of X

20.00 1 0.1
23.33 1 0.1
26.67 2 0.2
30.00 2 0.2
33.33 2 0.2
36.67 1 0.1
40.00 1 0.1
10.00 1.00

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Columns 1 and 2 show frequency distribution of sample means.

Columns 1 and 3 show sampling distribution of the mean.

=
 X =  x = 30, regardless of the sample size  = X .
N n

 (X )
2
−X 1000
= = = 14.142 .
i

N 5
 N − n 14.142 5−3
X = * = * = 5.774
n N −1 3 5 −1
2

  X i− X 
 333.4
= = = 5.774
N 10
Since averaging reduces variability  x < δ except the cases where δ = 0 and
n = 1.

Central Limit Theorem and the Sampling Distribution of the Mean

The Central Limit Theorem (CLT) states that:
1. If the population is normally distributed, the distribution of sample means
is normal regardless of the sample size.
2. If the population from which samples are taken is not normal, the
distribution of sample means will be approximately normal if the sample
size (n) is sufficiently large (n ≥ 30). The larger the sample size is used, the
closer the sampling distribution is to the normal curve.

The relationship between the shape of the population distribution and

the shape of the sampling distribution of the mean is called the Central
Limit Theorem.

The significance of the Central Limit Theorem is that it permits us to use sample
statistics to make inference about population parameters with out knowing
anything about the shape of the frequency distribution of that population other
than what we can get from the sample. It also permits us to use the normal
distribution (curve for analyzing distributions whose shape is unknown. It
creates the potential for applying the normal distribution to many problems
when the sample is sufficiently large.

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Example:
1. The distribution of annual earnings of all bank tellers with five years of
experience is skewed negatively. This distribution has a mean of Birr 15,000
and a standard deviation of Birr 2000. If we draw a random sample of 30
tellers, what is the probability that their earnings will average more than Birr
15,750 annually?

Solution:
Steps:
1. Calculate µ and  x
µ = Birr 15,000
 x = δ/√n= 2000/√30 = Birr 365.15

2. Calculate Z for X
X −X X −
ZX = =
X X
15,750 − 15,000
Z15, 750 = = + 2.05
365

3. Find the area covered by the interval

P ( X > 15,750) = P (Z > +2.05)
= 1 - P (+2.05)
= 1 – 0.9798
= 0.0202
4. Interpret the results
There is a 2.02% chance that the average earning being more than Birr 15, 750
annually in a group of 30 tellers.

2. Suppose that during any hour in a large department store, the average
number of shoppers is 448, with a standard deviation of 21 shoppers. What is the
probability of randomly selecting 49 different shopping hours, counting the
shoppers, and having the sample mean fall between 441 and 446 shoppers,
inclusive?
Solution:
1. Calculate µ and  x

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µ = 448 shoppers
 x = δ/√n= 21/√49 = 3

2. Calculate Z for X
X −X X −
ZX = =
X X
441 − 448 446 − 448
Z 441 = = − 2.33 Z 446 = = − 0.67
3 3

3. Find the area covered by the interval

P (441 ≤ X ≤ 15,750) = P (-2.33 ≤ Z≤ -0.67)
= P (0 to -2.33) - P (0 to - 0.67)
= 0.49010 – 0.24857
= 0.24153
4. Interpret the results
There is a 24.153% chance of randomly selecting 49 hourly periods for which
the sample mean falls between 441 and 446 shoppers.

3. A production company’s 350 hourly employees average 37.6 year of age, with
a standard deviation of 8.3 years. If a random sample of 45 hourly employees is
taken, what is the probability that the sample will have an average age of less
than 40 years?
Solution:
1. Calculate µ and  x
µ = 37.6 years n/N= 45/350 > 5%...... FPCF is needed
 N −n 8.3 350 − 45
x = * = x = * =1.16
n N −1 45 350 − 1

2. Calculate Z for X
X −X X −
ZX = =
X X
40 − 37.6
Z 40 = = + 2.07
1.16

3. Find the area covered by the interval

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P ( X < 40) = P (Z < +2.07)

= 0.5 + P (0 to +2.07)
= 0.5 + 0.48077
= 0.98077
4. Interpret the results
There is a 98.08% chance of randomly selecting 45 hourly employees and their
mean age be less than 40 years.

4. Suppose that a random sample size of 36 is being drawn from a population

with a mean of 278. If 86% of the time the sample mean is less than 280, what is
the population standard deviation?
Solution:
µ = 278 n = 36 P ( X < 280) = 0.86 δ =?
(Z/P=0.86) = +1.08
X − 
ZX = X =
X n
280 − 278 
Z 280 = 1.85 =
X 36
280 − 278 
+ 1.08 = 1.85 =
X 6
2  = 6 *1.85
+ 1.08 =
X =11.1
2
X = = 1.85
1.08

5. A teacher gives a test to a class containing several hundred students. It is

known that the standard deviation of the scores is about 12 points. A random
sample of 36 scores is obtained.
a) What is the probability that the sample mean will differ from the population
mean by more than 6 points?
b) What is the probability that the sample mean will be within 6 points of the
population mean?

Solution:
a)

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Business statistics Chapter One Sampling & Sampling distribution

 12 12
n = 36 δ =12 X = = = =2
n 36 6
P ( X > µ +6) + P ( X < µ - 6) =?
 +6−  −6−
Z +6 = = +3 Z  −6 = = −3
2 2
P ( X > µ +6) + P (Z> µ - 6) = P (Z > 3) + P (Z < - 3)
= [0.5 – P (0 to +3)] + [0.5 – P (0 to -3)]
= (0.5 – 0.49865) + (0.5 – 0.49865)
= 0.00135(2) = 0.00270
b)
 12 12
n = 36 δ =12 X = = = =2
n 36 6
P (µ - 6≤ X ≤ µ + 6) = P (- 3≤ Z ≤ 3)
= P (0 to 3)*2
= 0.49865*2
= 0.9973
If the population standard deviation is 12, in a random sample of 36 scores there
is a 99.73% chance of getting a sample mean score to lie within 6 points of the
population mean.

Wollo University CBE Department of ACFN Page 17