Suppose that X is a binomial random variable of n trials, with probability p of success on a trial. Here is a supplementary explanation of the textbook's claim that the 100(1-alpha)% confidence interval for p, defined by a sample value x of X, is [pL, pU], where the numbers pL and pU are characterized by the equations (6.1) and (6.2). These two equations are equivalent to the statments
Our explanation is in terms of the normal approximation. If X ~ B(n,p), then for n sufficiently large we know that (X - np)/sqrt(npq) is approximately a standard normal. Divide through by n and let phat = X/n denote the sample proportion. Then
where this last equality is approximate because in it we use the sample proportion phat to estimate p. Following the text, we let
The idea is to see that these two numbers satisfy the above characterizations ((6.1) and (6.2)). We proceed to do that. Under the assumption that X ~ B(n, pL), we have for x = n phat,
because sqrt(phat(1-phat))/sqrt(pL(1-pL)) is approximately equal to 1 (goes to 1 as n goes to infinity).