Professional Documents
Culture Documents
is
an
assumption/statement
Hypotheses testing is the procedure for testing a hypothesis in order to determine whether to accept or reject the statement based on the sample evidence available.
HYPOTHESIS TESTING
2
Null Hypotheses
Equality
is
always
part
of
H0
(e.g. = , , )
It is denoted by Ho or H sub-zero
Example:- Ho : = 500.
HYPOTHESIS TESTING
3
ALTERNATIVE HYPOTHESES
as Alternative Hypotheses.
It represent opposite/complement condition of Ho Inequality is always part of H1 (e.g. , , ) It is denoted by H1 or H sub-one Example:- H1 : 500, 500, 500
HYPOTHESIS TESTING
SIGNIFICANCE LEVEL
The level of significance also known as the size of the rejection region or the size of the critical region It is represented by (alpha)
HYPOTHESIS TESTING
CRITICAL REGION
The critical region (or rejection region) is the set of all values of the test statistic that cause us to reject the null hypothesis.
HYPOTHESIS TESTING
CRITICAL VALUE
A critical value is any value separating the critical region from the values of the test statistic that does not lead to rejection of the null hypothesis
HYPOTHESIS TESTING
Significance level()0.10
HYPOTHESIS TESTING
TYPES OF ERRORS
Decision Statement ACCEPT REJECT
TRUE
CORRECT
TYPE I ERROR
FALSE
TYPE II ERROR
CORRECT
HYPOTHESIS TESTING
LEFT TAILED
RIGHT TAILED
HYPOTHESIS TESTING
11
State Null and Alternative Hypotheses(H0 & H1) Select Significance Level () Identify Test statistic(z/t)
DECISION RULES FOR HYPOTHESES TESTING OF MEAN () AND PROPORTIONS () Rules for Rejecting H0 CASE 1 CASE 2 CASE 3
HYPOTHESIS TESTING
13
Before the 1973 oil embargo and subsequent increases in the prices of crude oil, gasoline usage in the USA had grown at a seasonally adjusted rate of 0.57 % /month, with standard deviation of 0.1%. In 15 randomly chosen months, gasoline usage grew at an average of only 0.37%/month . At 0.01
HYPOTHESIS TESTING
14
ANSWER
Acceptance Region
Rejection Region
Critical Value
-9.30 -2.624
HYPOTHESIS TESTING
15
From a Total of 10,200 loans made by a state employees credit union in the most recent 5 year period ,350 were sampled to determine what proportion was made to women. The sample
HYPOTHESIS TESTING
16
ANSWER
Acceptance Region
Rejection Region
Critical Value
-2.33
-0.763
2.33
17
HYPOTHESIS TESTING
HYPOTHESIS TESTING
18
Sampling distribution of the difference between sample means is used in two sample test. The distribution is made by all possible sample differences of sample means from two different sampling distributions of means.
HYPOTHESIS TESTING
19
HYPOTHESIS TESTING
20
Variance
32
Sample Size
150
200
21
ANSWER
Acceptance Region
Rejection Region
Critical Value
-2.41
-2.05
HYPOTHESIS TESTING
22
HYPOTHESIS TESTING
23
Small sample sizes refer to n 30. T-distribution is commonly used test statistic. The population variance of samples are assumed to be equal.
HYPOTHESIS TESTING
24
HYPOTHESIS TESTING
25
ANSWER
Acceptance Region
Rejection Region
Critical Value
-1.708 -1.54
HYPOTHESIS TESTING
26
HYPOTHESIS TESTING
27
On Friday, 11 stocks in a random sample of 40 of the roughly 2500 stocks traded on the NYSE advanced; that is the price of the shares advanced. In a sample of 60
HYPOTHESIS TESTING
28
ANSWER
Acceptance Region
Rejection Region
Critical Value
-1.29 -1.28
HYPOTHESIS TESTING
29
HYPOTHESIS TESTING
30
Participant
10
Before After
38 45
11 34 24 41
25 39
17 30
38 44
12 30
27 39
32 40
29 41
HYPOTHESIS TESTING
31
ANSWER
Acceptance Region
Rejection Region
Critical Value
2.262
HYPOTHESIS TESTING
2.46
32
"The only relevant test of the validity of a hypothesis is comparison of its predictions with experience." Milton Friedman
HYPOTHESIS TESTING
33
APARAJITA (14)
ARAKANSHU KUMAR (15)
HYPOTHESIS TESTING