Sample size is the number of observations taken from a population through which statistical inferences for the whole population are made.
Formula to calculate sample size.
- N = Population size.
- Z = Z value
- p = Sample proportion.
- e = Margin of error.
Example:
A website owner is interested to know how many of his customers bought an item from him after viewing his website on a certain day. Given that the website has on average 10,000 views per day, determine the sample size of the customers that he has to monitor at a 95% confidence level with a 2% margin of error.
Therefore,
N is 10,000.
The z value is 1.96.
The margin of error is 0.02
Since the current conversion rate is unknown, let us assume p = 0.5
Therefore, the sample size is 194.
