Confidence Interval Methodology for Ratio Means (CIM4RM)

The U.S. Army and many other government and private organizations need to evaluate ratio means to help them make informed life cycle management decisions. A ratio mean is the ratio of the mean of two random variables, X and Y. whose corresponding terms are paired. An example of a ratio mean that the Army evaluates is the maintenance ratio MR. The Army collects MR data from a sample of vehicles within a selected system and applies CIM4RM to the sample data to construct approximate confidence intervals CTs for the MR. CIM4RM is the combined effort of bootstrapping and creativity in constructing CLs around ratio means. CIM4RM was tested in many ratio mean applications and shown to be consistently valid. Prior to the development of CIM4RM, no documented tool existed that could produce consistently valid ratio mean CIs for various scenarios. The Army is currently using this methodology to evaluate ratio means for its fielded ground and aviation systems. The Office of Inspector General for Health and Human Services is utilizing this methodology for reporting ratio mean CIs to the U.S. Congress. Other existing applications include performance evaluations for Army test systems, evaluations of an Improvised Explosive Device detection demonstration, and hypothesis test development for many applications that compare two ratio means. Although current applications are government centric, there are countless other areas in private industry e.g. banking, automotive where CIM4RM can be used for improving decision analysis.