Testing Hypothesis: One-Sample Tests

Richard I Levin and David S Rubins book on Statistics for Management- Chapter 8

Contents
Concepts basic to hypothesis-testing procedure

Testing hypothesis
Hypothesis testing of means when is known Measuring the Power of a hypothesis test Hypothesis testing of proportions: Large Samples Hypothesis testing of means when is not known

Example
The roofing contract for a new sports complex in

Coimbatore has been awarded to L&T. Building specifications call for a movable roof covered by approximately 10,000 sheets of 0.04 inch think aluminum. The aluminum sheets cannot be appreciably thicker than 0.04 inch because the structure could not support the additional weight. Nor can the sheets be appreciably thinner than 0.04 inch because the strength of the roof would be inadequate. Because of this restriction on thickness, L&T carefully checks the aluminum sheets from its suppliers. Of course, L&T does not want to measure each sheet, so it randomly

Example continued:
The sheets in the sample have a mean thickness

of 0.0408 inch. From past experience with this supplier, L&T believes that these sheets come from a thinkness population with a standard deviation of 0.004 inch. On the basis of these data, L&T must decide whether the 10,000 sheets meet specifications.

Example
Building sports complex roof using aluminum

Claimed average thickness = 0.04 inch

(Population mean ) Unsatisfactory if it is too thin or too thick Contractor takes sample of 100 sheets (sample size n) Determines the sample mean thickness = 0.0408 inch (x ) Based on past experience population standard deviation = 0.004 inch ( ) Q) Based on the sample can the 10,000 sheet shipment be accepted by the contractor?

Example continued
Question being asked => If = 0.04 inch and = 0.004 inch What is the probability that a random sample with a mean0408 X 0. of inch will be selected from this population This probability will indicate whether it is reasonable to observe a sample like this or not
If the probability is too low then we must conclude

that the mean thinkness of the aluminum sheets is not 0.04 inch as claimed by the aluminum

Example continued
Converting to Z value

x
n

where x

Z = 2 standard error away from the mean

Finding Probabilities Corresponding to Known Values

Hypothesized population mean = 0.04 Sample mean = 0.0408

X 0.0004
2.28 % of area under curve

95.5 % of area
2 X

2 X

2.28 % of area under curve

-3

-2

-1

+1

+2
0.0408

+3
Z Scale

0.0392 0.039 0.04 0.04 0 -3 -2 6 -1 0

Example: continued
From the table we get the Z value for 2 se =

0.4772
Q) What is the probability that the sample mean 0.0408? (0.5 0.4772) = 0.0228 or 2.28% on one side of the distribution Q) Symmetrically what is the probability that the sample mean 0.0392 ? P(Z 2 or Z 2) = 2 x (0.5 0.4772) = 0.0456 or 4.56 %

Example conclusion
Ans) With this low %, contractor concludes that a population with a true mean of 0.04 inch would not be likely to produce a sample like this. Project supervisor rejects the aluminum companys statement about the mean thickness of the sheets Probability being low or high is subjective

Type I and Type II Error

Here we rejected the contention that population

mean is 0.04 inch But what if the population mean = 0.04 inch ? With the rejection rule of 2 standard deviation we are rejecting a good lot of aluminum sheets 4.56 % of the time.
Probability of rejecting a true hypothesis = 4.56%

Rejecting a true hypothesis is called Type I error

Accepting a false hypothesis is called Type II

error Level of significance = = 4.56%