Anova

Business Statistics, 4e
by Ken Black
Chapter 11
Discrete Distributions
Analysis of
Variance
& Design of
Experiments
Business Statistics, 4e, by Ken Black. 2003 John Wiley & Sons.
11-1
Learning Objectives
Understand the differences between various
experimental designs and when to use them.
Compute and interpret the results of a one-way
ANOVA.
Compute and interpret the results of a random
block design.
Compute and interpret the results of a two-way
ANOVA.
Understand and interpret interaction.
Know when and how to use multiple comparison
techniques.
11-2
Introduction to Design
of Experiments, #1
Experimental Design
- a plan and a structure to test hypotheses in
which the researcher controls or manipulates
one or more variables.
11-3
Introduction to Design of Experiments, #2

Independent Variable
Treatment variable is one that the experimenter
controls or modifies in the experiment.
Classification variable is a characteristic of the
experimental subjects that was present prior to the
experiment, and is not a result of the
experimenters manipulations or control.
Levels or Classifications are the subcategories of
the independent variable used by the researcher in
the experimental design.
11-4
Introduction to Design
of Experiments, #3
Dependent Variable
- the response to the different levels of the
independent variables.
11-5
Three Types
of Experimental Designs
Completely Randomized Design
Randomized Block Design
Factorial Experiments
11-6
Completely Randomized Design

Machine Operator
1
Valve Opening
Measurements
.
.
.
.
.
.
.
.
.
.
.
.
11-7
Valve Openings by Operator

1
6.33
6.26
6.44
6.29
6.26
6.36
6.38
6.23
6.31
6.23
6.58
6.19
6.29
6.27
6.54
6.21
6.4
6.19
6.56
6.5
6.34
6.19
6.58
6.22
11-8
Analysis of Variance: Assumptions

Observations are drawn from normally
distributed populations.
Observations represent random samples
from the populations.
Variances of the populations are equal.
11-9
One-Way ANOVA: Procedural

Overview
H :
o
Ha: At least one of the means is different from the others
MSC
F
MSE
If F >
If F
F , reject H .
F , do not reject H .
c
11-10
One-Way ANOVA:
Sums of Squares Definitions
total sum of squares = error sum of squares + between sum of squares
SST = SSC + SSE
Xij X
nj
i =1
j=1
n j
j 1
where :
j X
nj
i 1
j 1
X ij X j
i particular member of a treatment level
j = a treatment level
C = number of treatment levels
number of observations in a given treatment level
X = grand mean
X
X
ij
= mean of a treatment group or level

individual value
11-11
Partitioning Total Sum

of Squares of Variation
SST
(Total Sum of Squares)
SSC
(Treatment Sum of Squares)
SSE
(Error Sum of Squares)
11-12
One-Way ANOVA:
Computational Formulas
X
X
X
C
SSC n j
j 1
SSE
nj
i 1 j 1
SST
nj
j 1 i 1
MSC
MSE
j X
ij X
ij X
df
2
SSC
df
SSE
df
df
df
C 1
N C
N 1
where: i = a particular member of a treatment level
j = a treatment level
C = number of treatment levels
n=
j
MSC
F
MSE
X = grand mean
X
X =
j
ij
number of observations in a given treatment level
column mean
individual value
11-13
One-Way ANOVA:
Preliminary Calculations
1
6.33
6.26
6.44
6.29
6.26
6.36
6.38
6.23
6.31
6.23
6.58
6.19
6.29
6.27
6.54
6.21
6.4
6.19
6.56
6.5
6.34
6.19
6.58
6.22
Tj
T1 = 31.59
T2 = 50.22
T3 = 45.42
T4 = 24.92
T = 152.15
nj
n1 = 5
n2 = 8
n3 = 7
n4 = 4
N = 24
6.318000
6.277500
6.488571
6.230000
6.339583
Mean
11-14
One-Way ANOVA:
Sum of Squares Calculations
C
SSC n j
j 1
j X
[5 (6.318 6.339583) 8 (6.2775 6.339583)

2
7 (6.488571 6.339583) 4 (6.23 6.339583)

2
0.23658
nj C
SSE X ij X j
i 1 j 1
(6.33 6.318) (6.26 6.318) (6.31 6.318) (6.29 6.318)

2
(6.4 6.318) (6.26 6.2775) (6.36 6.2775)

2
(6.226.230)
0.15492
(6.19 6.230)
11-15
One-Way ANOVA:
Sum of Squares Calculations
nj
SST
i 1 j 1
ij X
(6.33 6.339583) (6.26 6.339583)

2
(6.31 6.339583) (6.22 6.339583)

2
(6.19 6.339583)
0.39150
11-16
One-Way ANOVA: df
Mean Square
df
and F Calculations df
C
E
T
C 1 4 1 3
N C 24 4 20
N 1 24 1 23
MSC
MSE
SSC
df
SSE
df
.23658
.078860
3
.15492
.007746
20
MSC .078860
F
10.18
MSE .007746
11-17
Analysis of Variance
for Valve Openings
Source of Variance
df
Between
Error
Total
3
20
23
SS
MS
0.23658 0.078860
0.15492 0.007746
0.39150
F
10.18
11-18
A Portion of the F Table for = 0.05
.05, 3, 20
df1
df 2
161.4
5
199.5
0
215.7
1
224.5
8
230.1
6
233.9
9
236.7
7
238.8
8
240.5
4
18
4.41
3.55
3.16
2.93
2.77
2.66
2.58
2.51
2.46
19
4.38
3.52
3.13
2.90
2.74
2.63
2.54
2.48
2.42
20
4.35
3.49
3.10
2.87
2.71
2.60
2.51
2.45
2.39
21
4.32
3.47
3.07
2.84
2.68
2.57
2.49
2.42
2.37
11-19
One-Way ANOVA:
Procedural Summary
Ho :
1
Ha : At least one of the means

is different from the others
20
Rejection Region
If F > Fc 3.10, reject Ho.

If F Fc 3.10, do reject Ho.
Since F = 10.18 > Fc 3.10, reject Ho.
Non rejection
Region
.05 , 9 ,11
3.10
Critical Value
11-20
Two-Way ANOVA: Hypotheses

Row Effects:
Ho:
Ha:
Columns Effects: Ho:
Ha:
Interaction Effects: Ho:
Ha:
Row Means are all equal.

At least one row mean is different from the others.
Column Means are all equal.
At least one column mean is different from the others.
The interaction effects are zero.
There is an interaction effect.
11-21
Formulas for Computing

a Two-Way ANOVA
R
SSR nC ( X
i 1
C
i X )
SSC nR ( X j X )
j 1
R
df
SSI n ( X ij X i X j X )
i 1 j 1
R
SSE ( X ijk X ij )
i 1 j 1 k 1
C
R
n
SST ( X ijk X )
c 1 r 1 a 1
SSR
R 1
SSC
MSC
C 1
SSI
MSI
R 1 C 1
SSE
MSE
RC n 1
MSR
df
df
df
df
R 1
C 1
R 1 C 1
RC n 1
N 1
MSR
MSE
MSC
MSE
MSI
MSE
FR
F
F
where:
n = number of observations per cell
C = number of column treatments
R = number of row treatments
i = row treatment level
j = column treatment level
k = cell member
X
X
X
X
ijk
ij
i
j
= individual observation
= cell mean
= row mean
= column mean
X = grand mean
11-22
A 2 3 Factorial Design
with Interaction
Row effects
Cell
Means
R1
R2
C1
C2
Column
C3
11-23
with Some Interaction
Row effects
Cell
Means
R1
R2
C1
C2
Column
C3
11-24
with No Interaction
Row effects
Cell
Means
R1
R2
C1
C2
C3
Column
11-25
A 2 3 Factorial Design: Data and

Measurements for CEO Dividend Example
Location Where Company
Stock is Traded
How Stockholders
are Informed of
Dividends
Annual/Quarterly
Reports
Presentations to
Analysts
Xj
NYSE
AMEX
2
1
2
1
X11=1.5
2
3
1
2
X21=2.0
2
3
3
2
X12=2.5
3
3
2
4
X22=3.0
1.75
2.75
OTC
Xi
4
3
4
2.5
3
X13=3.5
4
4
3
2.9167
4
X23=3.75
X=2.7083
N = 24
n=4
3.625
11-26
A 2 3 Factorial Design: Calculations

for the CEO Dividend Example (Part 1)
R
SSR nC ( X i X )
i 1
( 4)(3)[(2.5 2.7083) 2 ( 2.9167 2.7083) 2 ]

10418
.
C
SSC nR ( X j X )
j 1
( 4)(2)[(1.75 2.7083) 2 ( 2.75 2.7083) 2 ( 3.625 2.7083) 2 ]

14.0833
R
SSI n ( X ij X i X j X )
i 1 j 1
4[(15
. 2.5 1.75 2.7083) 2 ( 2.5 2.5 2.75 2.7083) 2
( 3.5 2.5 3.625 2.7083) 2 ( 2.0 2.9167 1.75 2.7083) 2
( 3.0 2.9167 2.75 2.7083) 2 ( 3.75 2.9167 3.625 2.7083) 2 ]
0.0833
11-27

R
SSE ( X ijk X ij)
i 1 j 1 k 1
(2 15
. ) (115
. ) (3 375
. ) (4 375
. )
2
7.7500
C
SST ( X ijk X )
c 1 r 1 a 1
(2 2.7083) (1 2.7083) (3 2.7083) (4 2.7083)

2
22.9583
11-28

SSR 10418
.
MSR
10418
.
R 1
1
SSC 14.0833
MSC
7.0417
C 1
2
SSI
0.0833
MSI
0.0417
R 1 C 1
2
SSE
7.7500
MSE
0.4306
RC n 1
18
MSR 10418
.
F R MSE 0.4306 2.42
MSC 7.0417
F C MSE 0.4306 16.35

MSI 0.0417
.
F I MSE 0.4306 010
11-29
Analysis of Variance
for the CEO Dividend Problem
Source of VarianceSS
df
Row
1.0418
Column
14.0833
Interaction
0.0833
Error
7.7500
Total
22.9583
*
MS
1
2
2
18
23
F
1.0418 2.42
7.0417 16.35*
0.0417 0.10
0.4306
Denotes significance at = .01.
11-30
Excel
Output
for the
CEO
Dividend
Example
(Part 1)
Anova: Two-Factor With Replication

SUMMARY
NYSE
ASE
OTC
Total
AQReport
Count
4
4
4
12
Sum
6
10
14
30
Average
1.5
2.5
3.5
2.5
Variance
0.3333 0.3333 0.3333
1
Presentation
Count
Sum
Average
Variance
4
8
2
0.6667
4
12
3
0.6667
4
15
3.75
0.25
8
14
1.75
0.5
8
22
2.75
0.5
8
29
3.625
0.2679
12
35
2.9167
0.9924
Total
Count
Sum
Average
Variance
11-31
Excel Output for the

CEO Dividend Example (Part 2)
ANOVA
Source of Variation
Sample
Columns
Interaction
Within
SS
1.0417
14.083
0.0833
7.75
Total
22.958
df
1
2
2
18
MS
1.0417
7.0417
0.0417
0.4306
F
P-value F crit
2.4194 0.1373 4.4139
16.355
9E-05 3.5546
0.0968 0.9082 3.5546
23
11-32

Anova

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Anova

Uploaded by

Copyright:

Available Formats

Business Statistics, 4e

Introduction to Design of Experiments, #2

Completely Randomized Design

Valve Openings by Operator

Analysis of Variance: Assumptions

One-Way ANOVA: Procedural

Ha: At least one of the means is different from the others

i particular member of a treatment level

number of observations in a given treatment level

= mean of a treatment group or level

Partitioning Total Sum

number of observations in a given treatment level

[5 (6.318 6.339583) 8 (6.2775 6.339583)

7 (6.488571 6.339583) 4 (6.23 6.339583)

(6.33 6.318) (6.26 6.318) (6.31 6.318) (6.29 6.318)

(6.4 6.318) (6.26 6.2775) (6.36 6.2775)

(6.33 6.339583) (6.26 6.339583)

(6.31 6.339583) (6.22 6.339583)

A Portion of the F Table for = 0.05

Ha : At least one of the means

If F > Fc 3.10, reject Ho.

Two-Way ANOVA: Hypotheses

Row Means are all equal.

Formulas for Computing

A 2 3 Factorial Design: Data and

A 2 3 Factorial Design: Calculations

( 4)(3)[(2.5 2.7083) 2 ( 2.9167 2.7083) 2 ]

( 4)(2)[(1.75 2.7083) 2 ( 2.75 2.7083) 2 ( 3.625 2.7083) 2 ]

A 2 3 Factorial Design: Calculations

SSE ( X ijk X ij)

(2 2.7083) (1 2.7083) (3 2.7083) (4 2.7083)

A 2 3 Factorial Design: Calculations

F C MSE 0.4306 16.35

Denotes significance at = .01.

Anova: Two-Factor With Replication

Excel Output for the

You might also like