Question

Give two examples of common applications of confidence intervals you might encounter in the “real world.”

Answer 1

(1) A clothing compny US POLO (say) makes a jeans of waist sizes 32 and 34. Now, since the jeans is manufactred and made by machines there is a slight margin of error in the waist sizes. Now you and your friend X bouht 32" waist size jeans. You come home and measure the waist size of the jeans individually by the correct way. You find the waist size of your jeans as 31.8" and X's jeans had a waist size of 32.4". Sow did the company put a tag of 32" on a 31.8" and a 32.4" jeans ? This is becuse the company assumes that any waist size of jeans within 31.8" and 32.4" is a 32" jeans with a probability of x% where x is usually 95 or 99. This is classified as a 95% or a 99% CI.

(2) The U.S. Census Bureau routinely uses confidence levels of 90% in their surveys. One survey of the number of people in poverty in 1995 stated a confidence level of 90% for the statistics The number of people in poverty in the United States is from some interval that means if the Census Bureau repeated the survey using the same technique.