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# HYPOTHESIS TESTING TEST of Hypothesis: an inference and a decision making process in which we use SAMPLE information to test whether

a POPULATION PARAMETER is less than, equal to or greater than a specified value. It will be possible to measure the reliability of the inference. The parameter we will deal with (in this course) will be: the population mean, : The population proportion, p We need to: Define the population under investigation State the hypothesis Mention the significance level (reliability) Select a sample, collect data (generally done by the researcher) Perform calculations Reach and state a conclusion SPEP 1 A Statistical Hypothesis is a theory about a population parameter, that may or may not be true. We have two types of hypothesis: Null Hypothesis Ho: represents the status quo, the conservative theory from previous experience that we accept until proven false. (Trial defendant assumed not guilty unless otherwise proved) Ho always contains the = sign. We always assume that Ho is true. It states that there is no difference between a parameter and a hypothesized value Ho: : = : o or Ho: p = po

Alternative Hypothesis Ha: a theory that contradicts the null hypothesis, by specifying a DIFFERENCE between the parameter and the hypothesized value. It contains the claim, or what the researcher wants to prove. or Ho: : < : o or Ho: : > : o

Ho: : : o

Example: A medical researcher wants to find out whether a new medication has undesirable side effects (ie pulse rate change). The mean pulse rate for the population under study is 82 beats per minute........Will the mean remain unchanged?

Example: A chemical company claims its products will increase the life of car batteries. The mean lifetime of cars batteries is 36 months........Test the companys claim.

Example: A company claims its insulation will lower heating bills. If the average heating bill is \$86, ........test the companys claim.

STEP 2 A test statistics is a formula used to decide whether to accept or reject the null hypothesis. The formula follows the format (sample) (population) Test value = observed value expected value Standard error Test for mean test for proportion z=

x 0 z= n

x np 0 np 0 (1 p 0 )

p p0 p 0 (1 p 0 ) n

or z =

STEP 3 State the significance level , or the maximum probability of committing a type I error, or rejecting the null hypothesis when Ho is true (convicting an innocent person). Another type of error that can be committed is , (Type II error), or failing to reject Ho when it is false (acquitting a guilty person). Reject Ho Accept Ho Ho true Type I error ( ) OK Ho false OK Type II error ( )

Rejecting the null hypothesis when Ho is true is a serious mistake, so its probability must be small. We will generally use = 5%, 10% or 1% measures the reliability of the inference. STEP 4 Select a critical value from a set of tables, that will separate the rejection region from the accept region. The rejection region must have a probability to contain the test statistics when the Ho is true, and represents the region in which there is a significant difference between the sample value and the hypothesized population value. One tailed test (right) ( Ha : > )

(Ha :

<

## If z < - z Reject Ho z > - z Accept Ho Two tailed test ( Ha : )

If z > z /2 or z < If z < - z /2 Reject Ho - z /2 < z < z /2 Accept Ho STEP 6 Compare the test statistics with the critical value. Make a decision and state it in terms of accept/reject H0 ACCEPT Ho means we do not have enough evidence to reject Ho and prove the claim. (defendant is NOT Guilty differs from defendant is innocent)