A market research firm hired by your company indicates in their proposal that 10

Question

A market research firm hired by your company indicates in their proposal that 10% of the population (or 500 out of 5,000) of the targeted population of high income individuals in West Texas need to be respond for accurate results. The owner of your company has doubts if this is correct, and has asked you if can recommend an approach to determine the appropriate sample size that would be statistically valid and less expensive. Provide your description of how you would go about selecting the appropriate minimum needed sample size.

Explanation / Answer

Selecting the appropriate minimum needed sample size:

Population: The number of population size should be calculated first before going into the sample size. If the population size is not exactly known, approximation can serve the purpose.

Margin of errors: It gives the percentage of errors to be allowed. This has to be decided in early because of getting confidence interval.

Confidence level: It gives faith on the research that the actual results falls within the limit. Suppose there might be 95% confidence level.

Standard deviation: This is the upper and lower limit of variance in which the actual result could deviate.

If the entire above are set, the sample size could be found very easily.

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