In hypothesis tests, the purpose was to make a decision about a parameter, in terms of it being greater than, less than, or not equal to a value. But what if you want to actually know what the parameter is. You need to do estimation. There are two types of estimation – point estimator and confidence interval.
- 8.1: Basics of Confidence Intervals
- A point estimator is just the statistic that you have calculated previously. As an example, when you wanted to estimate the population mean, the point estimator is the sample mean and to estimate the population proportion, you use the sample proportion. Point estimators are really easy to find, but they have some drawbacks. These problems are solved by using confidence intervals.