In the last post we saw the methods of sampling. In this post we will see sampling distributions.
Student’s t-distribution is a distribution that is symmetrical about the mean and has fatter tails than a normal distribution i.e., it has more observations in the tail. T-distribution is more appropriate to use when the sample size is small, n<30.
Confidence interval is the range of values within which a observation will lie with the probability of 1 – , where is the level of significance for the confidence interval and 1 – is the degree of confidence. For example we estimate that the probability that the observation will lie in the range 10 – 20 with 95% confidence and 5% level of significance.