What Margin of error is
The margin of error is a measure of the amount of uncertainty associated with a given sample statistic. It is used to determine the likelihood that an estimate of a population parameter is accurate. It is typically expressed as a percentage and is calculated by dividing the standard error of an estimate by the sample size.
Steps for calculating margin of error:
- Calculate the standard error of the statistic. This is done by taking the square root of the sample size times the standard deviation of the statistic, divided by the sample size.
- Divide the standard error by the sample size.
- Multiply the result by 100 to calculate the margin of error as a percentage.
- Add and subtract the margin of error from the estimate. The resulting range is the margin of error.
Examples
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Polls and surveys: A margin of error is often associated with surveys and polls, where the margin of error is determined by the sample size. For example, a poll of 1,000 people might have a margin of error of plus or minus 3%, meaning that the results could be off by 3% in either direction.
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Quality control: Margin of error is also often used in quality control, where the margin of error is used to determine the acceptable range of variation in a product or process. For example, a product might have a margin of error of plus or minus 0.5%, meaning that the product must be within 0.5% of the desired specifications in order to be acceptable.