Large-Sample Confidence Interval for

a Population Proportion
A Confidence Interval for a Population Proportion,p
The examples below report proportions. Note that each variable is
measured with the nominal scale of measurement.
 The career services director at Sehir University reports that 80
percent of its graduates enter the job market in a position
related to their field of study.
 A company representative claims that 45 percent of Burger King
sales are made at the drive-through window.
 A survey of homes in the Uskudar area indicated that 85
percent of the new construction had central air conditioning.
 A recent survey of married men between the ages of 35 and 50
found that 63 percent felt that both partners should earn a
living.
A Confidence Interval for a Population Proportion

To develop a confidence interval for a population proportion,

we need to meet the following assumptions.

1. The binomial conditions must be met. Briefly, these

conditions are:
a. The sample data is the result of counts.
b. There are only two possible outcomes.
c. The probability of a success remains the same from
one trial to the next.
d. The trials are independent. This means the outcome
on one trial does not affect the outcome on another.
Medication side effects (confidence
interval for p)
Arthritis is a painful, chronic inflammation of the joints.
An experiment on the side effects of pain relievers
examined arthritis patients to find the proportion of
patients who suffer side effects.
What are some side effects of ibuprofen?
Serious side effects (seek medical attention immediately):
Allergic reaction (difficulty breathing, swelling, or hives),
Muscle cramps, numbness, or tingling,
Ulcers (open sores) in the mouth,
Rapid weight gain (fluid retention),
Seizures,
Black, bloody, or tarry stools,
Blood in your urine or vomit,
Decreased hearing or ringing in the ears,
Jaundice (yellowing of the skin or eyes), or
Abdominal cramping, indigestion, or heartburn,
Less serious side effects (discuss with your doctor):
Dizziness or headache,
Nausea, gaseousness, diarrhea, or constipation,
Depression,
Fatigue or weakness,
Dry mouth, or
Irregular menstrual periods
 440 subjects with chronic arthritis were given ibuprofen for
pain relief; 23 subjects suffered from adverse side effects.

Calculate a 90% confidence interval for the population proportion p of

arthritis patients who suffer some “adverse symptoms.”
ˆˆ
pq
ˆ  z*
p
n
23
What is the sample proportion p̂ ? pˆ   0.052
440
For a 90% confidence level, z* = 1.645.
ˆˆ
pq
pˆ  z *
n
.052(1  .052) 90% CI for p :
.052  1.645
440 0.052  0.018  (.034,.070)
.052  1.645(0.011)
.052  .018
 We are 90% confident that the interval (.034, .070) contains the true
proportion of arthritis patients that experience some adverse symptoms when
taking ibuprofen.
 Estimation Example Proportion

A random sample of 400 graduates showed 32 went to

graduate school. Set up a 95% confidence interval estimate
for p.
ˆˆ
pq ˆˆ
pq 32
pˆ  Z /2   p  pˆ  Z  /2  pˆ   0.08
n n 400

.08  .92  .08  .92 

.08  1.96   p  .08  1.96 
400 400

.053  p  .107
Adjusted (1 – )100% Confidence Interval for a
Population Proportion, p when np is small

p 1  p 
p  z 2
n4

x2
p
where n  4 is the adjusted sample proportion of
observations with the characteristic of interest, x is the
number of successes in the sample, and n is the sample
size.
Determining the Sample Size

(given the confidence interval)

To estimate population mean µ
Determining Sample Size
The required sample size can be found to reach a desired
margin of error (e) with a specified level of confidence (1
- )
The margin of error is also called sampling error
the amount of imprecision in the estimate of the
population parameter
the amount added and subtracted to the point
estimate to form the confidence interval

X μ
σ
 z
n
Determining Sample Size

Using ( X  μ) 
Z X  μ  Z*
σ n
n
Sampling Error, or
margin error ME
Z
2 2

n 2
ME
To determine the required sample size for the mean, you
must know:
1. The desired level of confidence (1 - ), which
determines the critical Z value
2. The acceptable sampling error (margin of error), ME
3. The standard deviation, σ
 Example 1

A student in public administration wants to

determine the mean amount members of city
councils in large cities earn per month. She
would like to estimate the mean with a 95%
 z  
2
confidence interval and a margin of error of
less than $100. The student found a report by n 
the Department of Labor that estimated the  E 
standard deviation to be $1,000. What is the
minimum required sample size?
2
Given in the problem:  (1.96)($ 1,000) 
 
 E, the maximum allowable error, is $100,  $100 
 The value of z for a 95 percent level of
confidence is 1.96,  (19.6) 2
 The estimate of the standard deviation is
$1,000.  384.16
 385
Note: Always round n up to the nearest integer value.
If α is unknown...

If unknown, σ can be estimated when using the

required sample size formula

Use a value for σ that is expected to be at least

as large as the true σ

Select a pilot sample and estimate σ with the

sample standard deviation, S
If n calculated becomes <30

If the formula yields n<30

This solution is invalid as the procedure depends on the
Normal (or large sample) assumption
So, set n=30
Example 2

A consumer group would like to estimate the mean monthly

electricity charge for a single family house in July within $5
using a 99 percent level of confidence. Based on similar
studies, the standard deviation is estimated to be $20.00.
How large of a sample is required?

æ z ×s ö
2

n =ç ÷
è E ø

æ (2.58)(20) ö
2

n =ç ÷ = 107
è 5 ø
Example 3

You work in Human Resources at Merrill Lynch. You

plan to survey employees to find their average medical
expenses. You want to be 95% confident that the
sample mean is within ± $50.
A pilot study showed that  was about $400. What
sample size do you use?
Sample Size Solution

(z 2 )2  2
n
(SE)2

1.96 400
2 2


50
2

 245.86  246
To estimate population proportion p
Sample Size Determination for 100(1 – )
% Confidence Interval for p
In order to estimate p with a sampling error ME and with
100(1 – )% confidence, the required sample size is
found by solving the following equation for n:

p(1  p)
z  ME
n

The solution for n can be written as follows:

2

n Z p (1 - p)2
ME
 Example 1

The American Kennel Club wants to estimate the

proportion of children that have a dog as a pet. If the
club wants the estimate to be within 3% of the
population proportion, how many children would they
need to contact? Assume a 95% level of confidence
and that the club estimated that 30% of the children
have a dog as a pet.
æzö
2

n = p (1- p ) ç ÷
èEø
2
 1.96 
n  (.30 )(. 70 )   897
 .03 
 Example 2

A study needs to estimate the proportion of cities that have

private refuse collectors. The investigator wants the margin
of error to be within .10 of the population proportion, the
desired level of confidence is 90 percent, and no estimate is
available for the population proportion. What is the
required sample size?

æzö
2

n = p (1- p ) ç ÷
èEø
æ 1.645 ö
2

n = (.5)(1-.5) ç ÷ = 67.65
è .10 ø
n = 68 cities
So, if there is no estimation for p…
Finite Population Correction for
Simple Random Sample
Finite-Population Correction Factor (FPC)

A population that has a known size is said to be finite.

In some sampling situations, the sample size n may represent
5% or perhaps 10% of the total number N of sampling units in
the population.
When the sample size is large relative to the number of
measurements in the population, the standard errors of the
estimators of µ and p should be multiplied by a finite
population correction factor.
For a finite population, where the total number of objects is N
and the size of the sample is n, the following adjustment is
made to the standard errors of the sample means and the
proportion:
Finite Population Correction
Standard Error of the Mean Standard Error of the Proportion

 N n p(1  p) N  n
x  p 
n N n N
Rule of Thumb for Finite Population Correction Factor

Use the finite population correction factor when

n/N > .05.
Effects on FPC when n/N Changes

Observe that FPC approaches 1 when n/N becomes

smaller.
Finite Population Correction (FPC)

C.I. for the Mean () C.I. for the Mean ()
 N n s N n
xz xt
n N n N

C.I. for the Proportion ()

p(1  p) N n
pz
n N
CI for Mean with FPC – Example

There are 250 families in Given in the problem:

Scandia, Pennsylvania. A N = 250
random sample of 40 of these
families revealed the mean n = 40
annual church contribution was S = $75
$450 and the standard
deviation of this was $75. Since n/N = 40/250 = 0.16, the
finite population correction
factor must be used.
 Discuss why the finite-
population correction factor
should be used. The population standard
deviation is not known therefore
 What is the population use the t-distribution. (As n is
mean? What is the best large z can be also used)
interval estimate of the
population mean with 90%
confidence?
 Could the population mean s N n
be $445 or $425? xt
n N
Example

s N n
xt
n N

$75 250  40
$450  t
40 250
$75 250  40
$450  1.685
40 250
$450  $19.98 .84
$450  $18.31
($431.69, $468.31)

It is likely tha t the population mean is more than $431.69 but less than $468.31.
To put it another wa y, could the population mean be $445? Yes, but it is not
likely tha t it is $425 because the value $445 is within th e confidence
interval and $425 is not within the confidence interval.
Finite Population Correction Factor Example

You want to estimate a population mean, μ, where

x =115, s =18, N =700, and n = 60. Find an
approximate 95% confidence interval for μ.

Since
n  60  .086
N 700
is greater than .05 use the finite correction
factor
Example

You want to estimate a population mean, μ, where

x =115, s =18, N =700, and n = 60. Find an
approximate 95% confidence interval for μ.