Confidence interval

This describes the amount of uncertainty associated with the unknown population parameter in the estimated range of values of the population.

Interpreting the confidence intervals

Suppose it is given that the population mean is greater than 100 and less than 300, with a confidence interval of 95%.

General perception is that the chance of the population mean falling between 100 and 300 is 95%. This is wrong, as the population mean is not a random variable but is constant and doesn't change, and its probability of falling in any specified range is 0 to 1.

The uncertainty level associated with a sampling method is described by the confidence level. Suppose to select different samples and for each of these samples to compute a different interval estimate we used the same sampling method. The true population parameter would be included in some of these interval estimates, but not in every one.

So, the 95% confidence level means that the population parameter is included in 95...