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**IB Business and Management**

Sampling Methods (HL)

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Sampling When conducting market research it would be ideal to use results from the whole market (all customers and potential customers). The whole market is known as the POPULATION A survey of the whole population is called a CENSUS. However this is not always a practical and sensible idea.

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Why? Too Big Too Time Consuming Too Expensive

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If a business decides not to use a census it must decide who it is, they are going to ask. This is called a SAMPLE.

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**Sample Size The SAMPLE SIZE is the number of people within the sample**

The SAMPLE SIZE will be a trade-off between cost and accuracy

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**Factors affecting Sample Size**

(1) No estimate taken from a sample is expected to be exact: Any assumptions about the overall population based on the results of a sample will have an attached margin of error. (2) To lower the margin of error usually requires a larger sample size. (3) The confidence level is the likelihood that the results obtained from the sample lie within a required precision. Statisticians often use a 95 per cent confidence level to provide strong conclusions. (4) Population size does not normally affect sample size.

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Choosing the Sample Once the business has decided on how many people it will survey, they then need to choose who these people will be….. This is done using a sampling method

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Random Sample Everybody within the population has the same chance of being picked for research. This is like putting the name of everyone in a “hat” and picking out a percentage of the total to research. Advantages/limitations + Risk of bias minimised The people selected may not be part of the target group Sample sizes need to be large to get meaningful results

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Systematic Sampling After randomly selecting a starting point from the population, between 1 and "n", every nth unit is selected, where n equals the population size divided by the sample size Easier to extract the sample than via simple random; ensures sample is spread across the population Can be costly and time-consuming if the sample is not conveniently located

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**Example….. A firm has a workforce of 1000. Of these: 600 are male**

400 are female What percentages are these? If the business wants to do a survey of 100 employees how many males and females should they ask?

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**Example……. Of the male teachers: 60 are part time 540 are full time**

Of the female teachers: 80 are part time 320 are full time What percentages are these? So how many full timers and part timers should be surveyed

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**Survey Sample Category Sample size Males 60 Full Time 54 Part Time 6**

Females 40 32 8

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**Stratified Random Sample**

This is a way of choosing people making sure a fair spread of people are used. This is usually done by splitting up the population into certain characteristics. Once this has been done a random sample will be done on each group of people. This is an advantage from a pure random sample as it gives a fairer spread of the market.

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**Risk of interviewer bias**

Quota Sample Aim is to obtain a sample that is "representative" of the overall population; the population is divided ("stratified") by the most important variables a required quota sample is drawn from each stratum chosen by the interviewer This is a very good way of sampling if exact figures of your market are known; it is like sampling a mini version of the market. Not random, so still some risk of bias; need to understand the population to be able to identify the basis of stratification Risk of interviewer bias

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Cluster Sampling Units in the population can often be found in certain geographic groups or "clusters" A random sample of clusters is taken, then either all or a sample of people within the cluster are examined Quick & easy; does not require complete population information; good for face-to-face surveys Expensive if the clusters are large; greater risk of sampling error

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Judgment Sampling This is a way of using people who the interviewer feels will give a good response. It is a quick way of sampling and least expensive however the results will probably not give a good indication of the views of the whole market.

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Convenience Sampling This is a way of just using people who are convenient to the interviewer to ask. It is the quickest way of sampling and least expensive however the results will probably not give a good indication of the views of the whole market.

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Snowballing Surveys/Interviews are carried out with individuals who then suggest other friends/family/colleagues Useful if the business is unable to get hold of appropriate respondents Large risk of bias

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**Criteria for choice of sampling method**

Available budget Required accuracy Time constraints Availability of population

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**Types of Errors Sampling error Non response error**

Data collection error Data analysis error

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Sampling Error When there is bias due to the way the sample was selected

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