Market Research: Confidence Levels and Intervals

Flashcards covering key concepts of confidence levels and intervals in market research.

Why do businesses use sampling in market research?

To gather data from a representative portion of the target market, as it's not feasible to survey everyone.

Why are market research results based on sampling not 100% accurate?

Because not everyone in the target market has been surveyed, preventing absolute certainty.

What are confidence levels used for in market research?

To indicate how certain the market researcher is of the results obtained from sampling.

What does a 95% confidence level mean in the context of market research?

It means the researcher is 95% certain the results are reliable and represent the whole population.

What are confidence intervals?

The range of outcomes that are expected to occur with a given confidence level.

How does shrinking the confidence interval affect the confidence level?

The confidence level will decrease if the confidence interval becomes smaller because it is more difficult to predict precisely.

Why is the confidence interval generally bigger when the confidence level is higher?

Because it is more difficult to predict precisely when aiming for a higher degree of certainty, thus requiring a wider range.