Which of the following factors does not usually affect the width of a confidence interval?

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MH SET Paper-II: Commerce 7th April 2024
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  1. Sample size
  2. Confidence desired
  3. Variability in the population
  4. Population size

Answer (Detailed Solution Below)

Option 4 : Population size
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Detailed Solution

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The correct answer is - Population size

Key Points

  • Population size
    • Confidence intervals are typically calculated using the sample statistics rather than the size of the entire population.
    • In most practical applications, the population is considered infinitely large, making population size an irrelevant factor in determining the width of a confidence interval.
    • The finite population correction (FPC) is only applied when the sample is a significant fraction of the total population (typically >5%), which is uncommon in large populations.
  • Sample size
    • Larger sample sizes result in narrower confidence intervals due to reduced standard error.
  • Confidence desired
    • Higher confidence levels (e.g., 99% vs 95%) require wider intervals to ensure greater certainty of capturing the true parameter.
  • Variability in the population
    • Higher variability (or standard deviation) leads to wider confidence intervals to accommodate the increased uncertainty.

Additional Information

  • Formula for confidence interval width
    • For means: CI = x̄ ± Z*(σ/√n)
    • Key variables affecting width:
      • Z*: Depends on the confidence level.
      • σ: Population standard deviation (variability).
      • n: Sample size.
  • Finite Population Correction (FPC)
    • Used only when the sample is a large proportion of the population.
    • FPC = √((N - n)/(N - 1)), where N = population size, n = sample size.
    • In most exam scenarios, FPC is negligible, so population size does not affect confidence interval width.
  • Common misconceptions
    • Assuming that a larger population always increases uncertainty — this is incorrect unless FPC is applied.
    • Believing population size directly affects width — in standard practice, it does not.
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