Diffy said:
What I don't understand is that say I want to set up a test. I know that in 100,000 tries I get 70 successes.
In your initial post you said 0.74 percent. Now it sounds like the true figure is a factor of ten lower -- 0.070 percent.
So in a population of 5000 you would expect around 3.7 successes.
In my original example I don't even want to compare, because I don't think 5,000 is significant. How can I want to know how confident I am that that population size is enough.
Note that I'm not a practicing statistician and it's been a lot of years since I studied this stuff.
How big a sample you need depends on how small an effect you are trying to measure.
If you want to distinguish between 0.070 percent and 0.080 percent then you'll need a larger sample than if you want to distinguish between 0.070 percent and 50 percent.
A confidence interval calculator reports that in order to sample from a population of five million individuals and get a result that is accurate to 0.01 percent (able to distinguish between 0.070 percent and 0.080 percent) then you need a sample size in excess of four million.
If you relax that to 0.1 percent then you need 800,000
If you relax that to 1 percent then you need 9500
If you relax that to 10 percent then you need 96.
This fits with the naive principle that in order to increase accuracy by a factor of x you have to increase sample size by a factor of x
2.
The confidence interval calculator I used is based on the notion of polling individuals from a finite population without replacement. Worst case you sample the whole population and get a perfectly accurate result. In the case at hand it might be more appropriate to think in terms of sampling from an infinite population. That increases the required sample sizes significantly.
0.01 percent needs a sample size of 96 million
0.1 percent needs a sample size of 960 thousand
1 percent needs a sample size of 9600
10 percent needs a sample size of 96.
This is all at the 95 percent confidence level. For 99 percent confidence you need bigger sample sizes.