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Basic Concepts of Estimation

Here are the estimates for the problems: 1. 197 packets at 45p each ≈ 200 packets at 50p each = 200 * 50p = £100 So the approximate total cost is £100 2. 5 packs of turf at £91 each ≈ 5 packs at £100 each = 5 * £100 = £500 30 paving slabs at £5.81 each ≈ 30 slabs at £6 each = 30 * £6 = £180 4 fruit trees at £16.50 each ≈ 4 trees at £17 each = 4 * £17 = £68 Total estimate = £500 + £180 + £

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Christine Angel Dagsangan
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1K views17 pages

Basic Concepts of Estimation

Here are the estimates for the problems: 1. 197 packets at 45p each ≈ 200 packets at 50p each = 200 * 50p = £100 So the approximate total cost is £100 2. 5 packs of turf at £91 each ≈ 5 packs at £100 each = 5 * £100 = £500 30 paving slabs at £5.81 each ≈ 30 slabs at £6 each = 30 * £6 = £180 4 fruit trees at £16.50 each ≈ 4 trees at £17 each = 4 * £17 = £68 Total estimate = £500 + £180 + £

Uploaded by

Christine Angel Dagsangan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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BASIC CONCEPTS OF

ESTIMATION

Presented by: Group 6


OBJECTIVES

-DISCUSS THE PROPERTIES OF A GOOD ESTIMATOR.


-ILLUSTRATE THE POINT AND INTERVAL ESTIMATION.
-DISTINGUISH BETWEEN A POINT AND AN INTERVAL
ESTIMATION.
-IDENTIFY THE POINT ESTIMATOR FOR THE POPULATION
MEAN AND
POPULATION VARIANCE; AND
-COMPUTE THE POINT ESTIMATE OF THE POPULATION MEAN
AND
POPULATION VARIANCE.
BASIC CONCEPTS OF
ESTIMATION
Estimation is the process used to calculate the
population parameters by analyzing only a
small random of sample from the population.
The value or range of values used to
approximate a parameter is called an estimate.
INFERENTIAL STATISTICS

 Focuses on estimating and predicting the


results of a research study. Through the
process of estimation, a parameter value is
obtained using the information gathered
from a particular sample.
TWO TYPES OF PARAMETER ESTIMATES

1. Point Estimate
Refers to a single value that best determines the true parameter
value of
population.

2. Interval Estimate
Give’s a range of values within which the parameter value
possibly falls.
PROPERTIES OF A GOOD ESTIMATOR

1. UNBIASEDNES
Any parameter can be considered a random variable since
it’s value may change depending on certain factors including the
selection of the members of the sample. An estimate is said to
be unbiased when the expectation ( i.e., the mean) of all the
estimate taken from samples with size n is known to be equal to
the parameter being estimated.
2. CONSISTENCY
Consistency of an estimator is achieved when the estimate produced a
relatively smaller standard error.
This may be done by increasing the sample used to estimate the
population parameter. As the sample size increase, the value of the
estimator approaches the value of the parameter being estimated.

3. EFFICIENCY
From all the unbiased estimators of the population parameter, the
efficient estimator is the one that gives the smallest variance.
POINT ESTIMATOR

In this point estimation method, a population


parameter is estimated simply with its corresponding
sample statistics, the sample mean estimates the
population means, while the sample variance estimates
the population variance, and so on.
Formally speaking if x1,x2,x3…. X n denotes the
random variables from the random sample, then the
function u( x1,x2,…..x n) is used to estimate the
population. Parameter O is called the point
estimator of O. especially the following functions
are the point of the population mean u, and the
population variance 02 respectively.
INTERVAL ESTIMATION

A simple contains all the information the sample


provides. However, it is sometimes insufficient to
estimate the value of the population parameter using
only a single point estimator. For example through the
sample mean is a good estimator of the population mean
u,is not likely to be equal to u and you are unsure to the
accuracy such a point estimate.
Confidence levels correspond to probabilities or ( percentage of area )
associated with the normal curve.
To illustrate, a 90% confidence interval covers 90% of the normal
curve. Since the curve is symmetric, then the interval covers 45% of
the area to the right and 45% to the left, and the probability of
observing a value outside this interval, usually denoted o, is 10%: 5%
to the left. Figure 9.1 illustrates a 90% confidence interval on the
standard normal curve.
 NOTE that o=1-C is the area on the tails under the normal
curve one way use the alpha in locating the z-value in
constructing the confidence as shown in the figure. Further
remember that because the standard normal table is based
on areas between z=0 an Z , the Z-value is found by
locating area of 0.5- which is the part of the normal curve
between the middle of the curve and one of tails.
EXAMPLE: 1

Estimate the value of 6.9x96


* Round the numbers to one significant figure
6.9 rounded to 1, the significant figure is 7
96 rounded to 1, the significant figure is 100

Write out the new estimated calculation


6.9x96≈7x100
*Complete the calculation using the estimation
7x100= 700

“Therefore, the total estimation is 700”


2. Anna says that 472 ÷ 5=94.4. Use the
estimation to show that Anna cannot be
correct.

472÷5 ≈ 500÷5
500÷5=100
Therefore, the answer should be 100
THANKYOU!
1. Brian buys 197 packets of crisps for a party. Each
bag cost 45p. Use estimation to find the approximate
cost in pounds £.

2. Oliver wants to buy the following items for his


garden. 5packs of turf at £91 per pack. 30 paving slabs at
£ 5.81 each. 4 fruit trees at £ 16.50 each.

Estimate the total cost

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