Statistics for Managers

Using Microsoft Excel

5th Edition

Chapter 7
Sampling and Sampling Distributions

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-12

Why Sample?

Selecting a sample is less time-consuming

than selecting every item in the population
(census).
Selecting a sample is less costly than
selecting every item in the population.
An analysis of a sample is less cumbersome
and more practical than an analysis of the
entire population.

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-13

1
 Types of Samples
Samples

Non-Probability Probability Samples

Samples

Simple Stratified
Judgment Chunk Random

Systematic Cluster
Quota Convenience

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-14

Types of Samples

In a nonprobability sample, items included

are chosen without regard to their probability
of occurrence.
In convenience sampling, items are selected
based only on the fact that they are easy,
inexpensive, or convenient to sample.
In a judgment sample, you get the opinions of
pre-selected experts in the subject matter.

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-15

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 Types of Samples

In a probability sample, items in the sample

are chosen on the basis of known probabilities.

Probability Samples

Simple
Systematic Stratified Cluster
Random

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-16

Simple Random Sampling

Every individual or item from the frame has an

equal chance of being selected
Selection may be with replacement (selected
individual is returned to frame for possible
reselection) or without replacement (selected
individual isnt returned to the frame).
Samples obtained from table of random numbers
or computer random number generators.

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-17

3
 Systematic Sampling
Decide on sample size: n
Divide frame of N individuals into groups of k
individuals: k=N/n
Randomly select one individual from the 1st group
Select every kth individual thereafter

For example, suppose you were sampling n = 9

individuals from a population of N = 72. So, the
population would be divided into k = 72/9 = 8 groups.
Randomly select a member from group 1, say
individual 3. Then, select every 8th individual
thereafter (i.e. 3, 11, 19, 27, 35, 43, 51, 59, 67)

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-18

Stratified Sampling

Divide population into two or more subgroups

(called strata) according to some common
characteristic.
A simple random sample is selected from each
subgroup, with sample sizes proportional to strata
sizes.
Samples from subgroups are combined into one.
This is a common technique when sampling
population of voters, stratifying across racial or
socio-economic lines.

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-19

4
 Cluster Sampling

Population is divided into several clusters, each

representative of the population.
A simple random sample of clusters is selected.
All items in the selected clusters can be used, or items
can be chosen from a cluster using another probability
sampling technique.
A common application of cluster sampling involves
election exit polls, where certain election districts are
selected and sampled.

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-20

Comparing Sampling Methods

Simple random sample and Systematic sample
Simple to use
May not be a good representation of the populations
underlying characteristics
Stratified sample
Ensures representation of individuals across the entire
population
Cluster sample
More cost effective
Less efficient (need larger sample to acquire the same
level of precision)

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-21

5
 Evaluating Survey Worthiness

What is the purpose of the survey?

Were data collected using a non-probability
sample or a probability sample?
Coverage error appropriate frame?
Nonresponse error follow up
Measurement error good questions elicit good
responses
Sampling error always exists

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-22

Types of Survey Errors

Coverage error or selection bias
Exists if some groups are excluded from the frame
and have no chance of being selected
Non response error or bias
People who do not respond may be different from
those who do respond
Sampling error
Chance (luck of the draw) variation from sample to
sample.
Measurement error
Due to weaknesses in question design, respondent
error, and interviewers impact on the respondent

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-23

6
 Sampling Distributions

A sampling distribution is a distribution of all of the

possible values of a statistic for a given size sample
selected from a population.
For example, suppose you sample 50 students from
your college regarding their mean GPA. If you
obtained many different samples of 50, you will
compute a different mean for each sample. We are
interested in the distribution of all potential mean GPA
we might calculate for any given sample of 50
students.
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-24

Sampling Distributions
Sample Mean Example

Suppose your population (simplified) was

four people at your institution.
Population size N=4
Random variable, X, is age of individuals
Values of X: 18, 20, 22, 24 (years)

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-25

7
 Sampling Distributions
Sample Mean Example
Summary Measures for the Population Distribution:

X i
P(x)
N .3
18 20 22 24
21 .2
4
.1

(X ) i
2

2.236
0
18 20 22 24 x
N
A B C D
Uniform Distribution
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-26

Sampling Distributions
Sample Mean Example
Now consider all possible samples of size n=2

1st 2nd Observation 16 Sample

Obs. Means
18 20 22 24
1st 2nd Observation
18 18,18 18,20 18,22 18,24 Obs.
18 20 22 24
20 20,18 20,20 20,22 20,24
18 18 19 20 21
22 22,18 22,20 22,22 22,24
20 19 20 21 22
24 24,18 24,20 24,22 24,24
22 20 21 22 23
16 possible samples
(sampling with 24 21 22 23 24
replacement)
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-27

8
 Sampling Distributions
Sample Mean Example
Sampling Distribution of All Sample Means
16 Sample
Means Sample Means
Distribution
P(X)
1st 2nd Observation
Obs .3
18 20 22 24
.2
18 18 19 20 21

20 19 20 21 22 .1
22 20 21 22 23
0 _
24 21 22 23 24 18 19 20 21 22 23 24 X
(no longer uniform)
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-28

Sampling Distributions
Sample Mean Example
Summary Measures of this Sampling Distribution:

X
X i

18 19 21 24
21
N 16

X
(X i
X
)2
N

(18 - 21)2 (19 - 21)2 (24 - 21)2

1.58
16

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-29

9
 Sampling Distributions
Sample Mean Example
Population Sample Means Distribution
N=4 n=2
21 2.236 X 21 X 1.58
_
P(X) P(X)
.3 .3
.2 .2
.1 .1
0 X
0 18 19 20 21 22 23 24
_
18 20 22 24 X
A B C D

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-30

Sampling Distributions
Standard Error
Different samples of the same size from the same population
will yield different sample means.
A measure of the variability in the mean from sample to
sample is given by the Standard Error of the Mean:

X
n
Note that the standard error of the mean decreases as the
sample size increases.
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-31

10
 Sampling Distributions
Standard Error: Normal Pop.
If a population is normal with mean and standard
deviation , the sampling distribution of the mean is also
normally distributed with

X and X
n
(This assumes that sampling is with replacement or sampling
is without replacement from an infinite population)

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-32

Sampling Distributions
Z Value: Normal Pop.
Z-value for the sampling distribution of the sample mean:

(X X ) (X )
Z
X
n

where: X = sample mean

= population mean
= population standard deviation
n = sample size

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-33

11
 Sampling Distributions
Properties: Normal Pop.

Normal Population
Distribution
x
x
(i.e. x is
unbiased ) Normal Sampling
Distribution
(has the same mean)

x
x
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-34

Sampling Distributions
Properties: Normal Pop.
For sampling with replacement:
As n increases, Larger sample
x decreases size

Smaller sample
size

x
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-35

12
 Class Exercise

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-36

Class Exercise

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-37

13
 Sampling Distributions
Non-Normal Population
The Central Limit Theorem states that as the sample
size (that is, the number of values in each sample)
gets large enough, the sampling distribution of the
mean is approximately normally distributed. This is
true regardless of the shape of the distribution of the
individual values in the population.
Measures of the sampling distribution:

x x
n
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-38

Sampling Distributions
Non-Normal Population
Population Distribution

x
Sampling Distribution
(becomes normal as n increases)
Larger
Smaller sample size sample
size

x
x
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-39

14
 Sampling Distributions
Non-Normal Population
For most distributions, n > 30 will give a
sampling distribution that is nearly normal
For fairly symmetric distributions, n > 15 will
give a sampling distribution that is nearly
normal
For normal population distributions, the
sampling distribution of the mean is always
normally distributed

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-40

Sampling Distributions
Example
Suppose a population has mean = 8 and standard
deviation = 3. Suppose a random sample of size n = 36
is selected.
What is the probability that the sample mean is between
7.75 and 8.25?
Even if the population is not normally distributed, the
central limit theorem can be used (n > 30).
So, the distribution of the sample mean is approximately
normal with
x 8 3
x 0.5
n 36
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-41

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 Sampling Distributions
Example
First, compute Z values for both 7.75 and 8.25.
7.75 - 8
Z 0 . 5
3
36
8.25 - 8
Z 0 .5
3
36
Now, use the cumulative normal table to compute
the correct probability.

P(7.75 X 8.25) P(-0.5 Z 0.5) 0.3830

Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-42

Sampling Distributions
Example
Population
Distribution

= 2(.5000-.3085)
= 2(.1915)
8 X = 0.3830
Sample

Sampling Standardized Normal

Distribution Distribution

7.75 8.25 -0.5 0.5

X 8 x z 0 Z
Statistics for Managers Using Microsoft Excel, 5e 2008 Pearson Prentice-Hall, Inc. Chap 7-43

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