Sampling and Sampling

Distribution

Business Statistics
 Target Population
The target population is the entire group a researcher is
interested in; the group about which the researcher
wishes to draw conclusions.
Example: Suppose we take a group of men aged 35-40 who
have suffered an initial heart attack. The purpose of this
study could be to compare the effectiveness of two drug
regimes for delaying or preventing further attacks. The
target population here would be all men meeting the same
general conditions as those actually included in the study.
Major reasons why sampling is necessary

The destructive nature of certain tests.

The physical impossibility of checking all
items in the population.
The cost of studying all the items in a
population is often prohibitive.
The adequacy of sample results.
To contact the whole population would often
be time consuming
 Probability Sampling Methods

There are two types of sample:

a) Probability sample
b) Nonprobability sample
 Probability sample
A sample selected in such a way that each item
or person in the probability has a known
likelihood of being included in the sample.

Nonprobability sample
In this sample, not all items or people have a
chance of being chosen.
 Methods of Sampling
a) Probabolity/ Random Sampling b) Non-random Sampling:
method:

i) Simple Random Sampling i) Judgment Sampling

ii) Systematic Sampling ii) Quota Sampling

iii) Stratified Sampling iii) Convenience

iv) Cluster Sampling Sampling

i) Simple Random Sampling
Simple random sampling is the basic sampling
technique where we select a group of subjects
(a sample) for study from a larger group (a
population).

Each individual is chosen entirely by chance

and each member of the population has an
equal chance of being included in the sample.
 ii) Systematic Sampling

A probability sampling technique in which the

sample is chosen by selecting a random
starting point and then picking every ith
element in succession from the sampling
frame.
 iii) Stratified Sampling
Stratified sampling is a probability sampling technique wherein
the researcher divides the entire population into different
subgroups or strata, then randomly selects the final subjects
proportionally from the different strata.
 Stratification is the process of dividing
members of the population into homogeneous
subgroups before sampling. The strata should
be mutually exclusive: every element in the
population must be assigned to only one
stratum.
The strata should also be collectively
exhaustive: no population element can be
excluded. Then simple random sampling or
systematic sampling is applied within each
stratum.
iv) Cluster Sampling
Cluster sampling is a sampling technique where the
entire population is divided into groups, or clusters,
and a random sample of these clusters are selected. All
observations in the selected clusters are included in
the sample.
Cluster sampling is a sampling technique used when
"natural" but relatively homogeneous groupings are
evident in a statistical population.
In this technique, the total population is divided into
these groups (or clusters) and a simple random
sample of the groups is selected.
 b) Non-random Sampling
i) Judgment Sampling
A form of convenience sampling in which the
population elements are purposively selected
based on the judgment of the investigator.
In other words, the investigator exercises his
judgment in the choice of sample items and
includes those items in the sample which he
thinks are most typical of the population with
regard to the characteristics under investigation.
ii) Quota Sampling
Quota sampling is a type of judgment
sampling. In a quota sample, quotas are set up
according to given criteria, but, within the
quotas the selection of sample items depends
on personal judgment.
iii) Convenience Sampling
A nonprobability sampling technology that
attempts to obtain a sample of convenient
elements.
Differences between Populations and
Samples
Population Sample
Definition Collection of items being Part or portion of the population
considered chosen for study

Characteristics Parameters Statistic

Population size = N Sample size= n
Symbol Population mean= Sample mean = x
Population standard deviation= Sample standard deviation = S
 Sampling Distribution
A probability distribution of all the possible
means of the samples is distribution of the
samples means. Statisticians call this a
sampling distribution of the mean.
 Concept of Standard Error
The standard deviation of the distribution of
sample means measures the extent to which
we expect the means from the different
samples to vary because of this chance error in
the sampling process.
Thus, the standard deviation of the distribution
of a sample statistic is known as the standard
error of the statistic.
 Standard Error of the mean for infinite
population

= Population standard deviation

n = Sample size
Standardizing the sample mean
 Levin Rubin, SC 6-5
Problem 1
In a sample of 25 observations from a normal
distribution with mean 98.6 and standard
deviation 17.2.
a) What is P(92<X<102)?
b) Find the corresponding probability given a
sample of 36.
Problem 2 Levin Rubin, SC 6-6

Mary Bartel, an auditor for a large credit card

company, knows that, on average, the monthly
balance of any given customer is $112, and the
standard deviation is $56. If Mary audits 50
randomly selected accounts, what is the
probability that the sample average monthly
balance is
a) below $100
b) between $100 and $130
 Levin Rubin, Exercise 6-27
Problem 3

In a sample of 16 observations from a normal

distribution with a mean of 150 and a variance
of 256, what is
a) P(X<160)
b) P(X >142)?
Problem 4

The weight of certain type of tyre is normally

distributed with a mean of 25 pounds and
variance of 3 pounds.
A random sample of 25 tyres is selected. What
is the probability that the mean of this sample
lies between 24.5 and 25.5 pounds.
 Standard Error of the mean for finite
population

= Population standard deviation

N= Size of population
n = Sample size
 Levin Rubin, SC 6-7
Problem 5
From a population of 125 items with a mean of
105 and a standard deviation of 17, 64 items
were chosen.

a) What is the standard error of the mean?

b) What is the P(107.5< x <109)?
Problem 6
Levin Rubin, Exercise 6-41

Given a population of size N=80 with a mean of

22 and a standard deviation of 3.2, what is the
probability that a sample of 25 will have a mean
between 21 and 23.5?