> A global consumer survey reported that 6% of US taxpayers used or owned cryptocurrency in 2020. The US government is interested in knowing if this percentage has increased. The University of Chicago surveys 1,004 taxpayers and finds that 13% have used or owned crypto in the past year (2021)
| Simple random | Advantages:<br>- Procedure is impartial<br>- Law of Averages<br>Disadvantages<br>- Not always possible<br>- Can be very expensive |
| Quota Sampling | Attempts to get certain proportions based on key characteristics. Quota sampling doesn't guarantee that the selection is an accurate representation. |
| Cluster Sampling | Divide population into subgroups, randomly select a subgroup, and sample all of the subjects in that group |
Throughout this chapter, percentages are often represented by referencing a box model of 1s and 0s, where 1s are datapoints that *are* counted, and 0s are datapoints that are not counted.
To determine by how much the standard error is affected, if $n$ is the proportion that the population changed by, the standard error will change by $\frac{1}{\sqrt{n}}$. For example, if a population changed from 20 to 40, that change was by a proportion of 2, and so you would say the standard error decreased by $\frac{1}{\sqrt{2}}$.
Accuracy in statistics refers to how small the standard error is. A smaller standard error means your data is more accurate. As the sample size increases, the percentage standard error decreases.
You can use the below equation to find the percentage standard error of a box model that has ones and zeros. the % of ones and zeros should be represented as a proportion (EG: `60% = 0.6`).
Take a sample, find the average, plot it and repeat. After many many samples, the *observed* probability histogram for sample averages looks like the *predicted* probability histogram.
As with $SE_\%$, as the sample size increase, the standard error decreases.
The central limit theorem still applies here, so the probability histogram for the average of the draws *follows the normal curve* with a large number of draws, even if the contents of the box do not.
Remember that the *parameter* is the *number* that actually describes the population.
95% confidence means that 95% of the time the interval constructed will capture the parameter, and 95% of the time it will not.
For any unknown average, the probability histogram of the sample averages will be shaped like the normal curve and centered at the true average with a standard deviation equal to $SE_{ave}$.
$$ sample_{ave} \pm 2 * se_{ave} $$
The above equation will give you an interval that you can be 95% confident that the true random will be within that point.
95% does *not* mean that 95% of the data is in the interval, it just means we are 95% confident that the actual point is going to lie within the range specified.