Data Analysis with Microsoft Excel: Updated for Office 2007

230 Fundamentals of Statistics

3 Click Explore the Confi dence Interval from the Table of Contents

column. See Figure 6-4.

Figure 6-4

The

Confidence

Intervals

workbook

true mean value

confidence intervals that

don’t capture the true mean

drag to change the

size of the

confidence interval

size of the

confidence

interval

The worksheet in Figure 6-4 shows 100 simulated confi dence intervals

taken from a normal distribution with m 550 and s54. Each of the 100

samples contains 25 observations, so the standard error of each sample aver-

age is 0.8.

If a confi dence interval captures the true value of m, it shows up on the

chart as a vertical green line. If a confi dence interval does not include m, it

shows up as a vertical red line. You would expect that 95 of the 100 samples

would include the value of m in their confi dence intervals. Because there

is some random variation, Figure 6-4 shows that only 94% of the sample

confi dence intervals include the value of m. Using this worksheet, you can

generate a new random sample or change the width of the confi dence band.

Try this now by reducing the confi dence interval from 95 to 75%.

To reduce the size of the confi dence interval:

1 Drag the vertical scroll bar up until the value 75.0% appears in the

highlighted Confi dence Interval box. See Figure 6-5.