3. Confidence Interval About the Mean Using the TINV Function and Hypothesis Testing

This chapter explains how to find the 95% confidence interval about the mean for a set of data, and how to test hypothesis about your data using this confidence interval. You will learn how to estimate the population mean (average) for a group of people (or objects) at a 95% confidence level so that you are 95% confident that the population mean is between a lower limit of the data and an upper limit of the data. The formula for computing this confidence interval is presented, explained, and a sample problem is given using your calculator. You will then learn how to use Excel commands to determine the 95% confidence interval about the mean using Excel’s TINV function. The second half of this chapter explains hypothesis testing and how you can test hypotheses about your data using Excel commands to find the 95% confidence about the mean for your data. Seven steps are presented for this test, and you will be given specific explanations of how to write both the result and the conclusion of an hypothesis test. Alternative ways to summarize the result of an hypothesis test are also presented. Three practice problems are given at the end of the chapter to test your Excel skills, and the answers to these problems appear in Appendix A of this book. An additional practice problem is presented in the Practice Test given in Appendix B along with its answer in Appendix C of this book.