All else being equal, what usually happens to the standard error when the sample size increases?
5 Estimation and Confidence Intervals Online Quiz Questions
Use this free practice quiz with 20 questions to review 5 Estimation and Confidence Intervals, test your knowledge, and prepare for your next test or exam.
A procedure that produces 95% confidence intervals captures the fixed population parameter in about 95% of intervals over repeated samples, under the procedure’s assumptions.
- A
True
- B
False
A random, independent sample is used to estimate a population mean, and the population standard deviation is unknown. Which expression gives the usual two-sided confidence interval?
- A
xˉ±z1−α/2ns
- B
xˉ±t1−α/2,nnσ
- C
xˉ±t1−α/2,n−1ns
- D
xˉ±z1−α/2nσ
A simple random sample is used to estimate a population mean, and the population size N is known. To obtain an interval for the population total from the mean interval, .
Which interval is often preferable to the normal-approximation interval when a sample is small or the proportion is near 0 or 1?
Select all situations that should raise caution about using the normal-approximation interval for a population proportion.
- A
A small sample can make the normal approximation unreliable.
- B
A large sample always makes the normal approximation reliable, regardless of the observed proportion.
- C
A proportion near 0 or 1 can make the normal approximation perform poorly.
- D
The approximation is appropriate only when the sample contains no failures.
A retailer compares sales before and after a change using measurements from the same stores. Which approach matches the paired-data design?
- A
Treat the before and after measurements as unrelated groups and ignore which observations came from the same store.
- B
Analyze the within-store differences.
- C
Use only the after-change measurements.
- D
Estimate the difference by comparing the two sample standard deviations.
If a confidence interval for a difference in means contains zero, this establishes that the two population means are equivalent.
- A
True
- B
False
In a sample of 75 customers, 45 renewed. What is the sample proportion of renewals? Enter the proportion as a decimal.
In a confidence interval, the quantity equal to the critical value multiplied by the standard error is called the .
Select all statements supported by the methods for other business quantities.
- A
A regression slope interval estimates the change in the mean outcome associated with a one-unit increase in the predictor under the fitted model.
- B
A regression slope interval estimates the change in the predictor associated with a one-unit increase in the mean outcome.
- C
For normally distributed data, an interval for variance uses the chi-square distribution rather than the mean’s t-interval.
- D
An interval for variance uses the same standard error and critical value as an interval for a population proportion.
A campaign’s estimated increase in average revenue is positive, but its confidence interval is wide and includes effects that may be too small to cover the campaign cost. What is the most appropriate way to use the interval in the decision?
- A
The estimate is positive, so the campaign must be worthwhile regardless of the interval.
- B
The interval includes zero, so the campaign can have no effect.
- C
Compare the interval with the minimum effect that would justify the campaign cost; a plausible effect may be too small to matter financially.
- D
Ignore the interval’s width if the point estimate is positive.
A business analyst reports a confidence interval for a regression slope. Explain what the slope interval estimates and how its width helps the business understand the estimate.
A researcher calculates one 95% confidence interval for a population mean. Which interpretation of the 95% confidence level is correct?
- A
There is a 95% probability that the fixed parameter lies in this particular interval.
- B
About 95% of intervals produced by this procedure over repeated samples capture the fixed parameter.
- C
The sample estimate is correct 95% of the time.
- D
The parameter changes from sample to sample, and 95% of its values lie in the interval.
Keeping the data variability and interval method otherwise comparable, how do a larger sample size and a higher confidence level usually affect a confidence interval's width?
- A
A larger sample and a higher confidence level both usually make the interval narrower.
- B
A larger sample usually makes the interval wider, while a higher confidence level makes it narrower.
- C
A larger sample usually makes the interval narrower, while a higher confidence level makes it wider.
- D
Neither sample size nor confidence level affects interval width.
A company records sales for the same stores before and after a pricing change. Which approach best estimates the mean change in sales?
- A
Calculate each store's before-and-after difference and construct an interval for the mean of those differences.
- B
Treat all before and after measurements as independent and compare the two sample means.
- C
Construct separate intervals for the before and after means and infer the difference from their overlap.
- D
Use a confidence interval for a population proportion.
A manager wants a confidence interval for a population mean from a small sample. The population standard deviation is unknown, and the sample has strong skew and an extreme outlier. Which statement best describes the usual t-interval?
- A
Use a z-interval because the sample mean is always normally distributed, regardless of sample size or data shape.
- B
Use a proportion interval because the sample contains multiple observations.
- C
Use a t-interval regardless of outliers or severe skew, since it automatically handles them.
- D
A t-interval is the usual choice when the population standard deviation is unknown, but strong skew or outliers can undermine it, especially with a small sample.
For normally distributed data, which distribution is used to construct confidence intervals for the population variance or standard deviation?
A confidence interval for the difference between two population means contains zero. This alone establishes that the two means are equivalent.
- A
True
- B
False
A random, independent sample of 100 orders has a mean value of $50. The population standard deviation is known to be $10. Using a 95% confidence interval with critical value z=1.96, what is the lower endpoint of the interval in dollars? Round to the nearest cent.