Question
The variable I have chosen this week is the unemployment rate in the state of Maine from the years of 2007 to 2017. The numbers
The variable I have chosen this week is the unemployment rate in the state of Maine from the years of 2007 to 2017. The numbers represent the percentage of the total force that is jobless in Maine for each respective year.
Year | Unemployment rate in Maine |
2007 | 4.7 |
2008 | 5.3 |
2009 | 8.4 |
2010 | 8.4 |
2011 | 7.7 |
2012 | 7.2 |
2013 | 6.7 |
2014 | 5.6 |
2015 | 4.4 |
2016 | 3.8 |
2017 | 3.1 |
To construct a confidence interval, we first need to calculate the mean (average) and standard deviation of the data.
The Sample mean (x) is the average of the unemployment percentages. In the Google Sheets, it is calculated as follows: =Average (range) function, where "range" is the range of cells containing the data:
4.7 + 5.3 + 8.4 + 8.4 + 7.7 + 7.2 + 6.7 + 5.6 + 4.4 + 3.8 = 3.1/ 11=6.1
The Sample Size (n) is the number of years that the percentage of unemployment in the State of Maine was measured int the data. This can be found by simply counting the number of data points (years) in the table given. Standard Deviation () measures the amount of variation or dispersion in the data set. In Google sheets, this can be calculated by using the =STDEV.S (range) function, where "range" is the range of cells containing the data. For the confidence level I am using the 95%. The alpha level()for a 95% confidence level is 1.96. To calculate the standard deviation, we first find the variance. Variance is the average pf the squared differences from the mean.
Variance: = [(4.7-6.1) ^2+(5.3-6.1) ^2+(8.4-6.1) ^+(8.4-6.1) ^2+(7.7-6.1) ^2+(7.2-6.1) ^2+(6.7-6.1) ^2+(5.6-6.1) ^2=x + (4.4-6.1) ^2+(3.8-6.1) ^2+(3.1-6.1) ^2/ (11-1)
Standard Dviation()=sqrt(Vn)=sqrt(1.7)=1.96
Confidence Interval=mean (Z*/Vn) =6.1 (1.96*(1.7%/sqrt (11)
Confidence Interval + (5.1%-7.1%)
The confidence interval tells that we can be 95% confident that the true average unemployment rate in Maine from 2007 to 2017 falls between 51% and 7.1%. The spread of this interval is relatively small (2%), indicating that the employment rate did not vary drastically during this period.
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