Hypothesis Testing and P Value

BY DR ZAHID KHAN
SENIOR LECTURER KING FAISAL UNIVERSITY,
KSA

Two ways to learn

about a population
Confidence

intervals

Hypothesis

testing

HYPOTHESIS
What do you mean by a Hypothesis?
A hypothesis is a proposition that is

assumed as a premise in an argument / claim

set forth as an explanation for the occurrence of some

specified group of phenomena

A hypothesis is a prediction about the outcome of an

experiment. In market research this could be the result
of the out come of a focus or field study

Why do we make
hypotheses?

The practice of science traditionally involves

formulating and testing hypotheses

Hypotheses are assertions that are capable of being

proven false using a test of observed data

Hypothesis testing is a procedure through which

sample data is used to evaluate the credibility of a
hypothesis

TYPES OF HYPOTHESIS
Null Hypothesis

The null hypothesis typically corresponds to a general or

default position

Making this assertion will make no difference and hence

cannot be proven positively

Alternate Hypothesis

An alternate hypothesis asserts a rival relationship

between the phenomena measured by the null
hypothesis

It need not be a logical negation of the null hypothesis as

it only helps in rejecting or not rejecting the null
hypothesis

Dependant and independent

variables
Shoppers

in a store playing music shop spend

more.
Independent
Music

Variable:

in the store

Dependent
Amount

Variable:

spent in store

Example -- Continued
1.

Obtain a random sample of shoppers who go

to stores with music

2.

Check shop spending

3.

Compare sample data to hypothesis

4.

Make decision:
1.

Reject the hypothesis

2.

Fail to reject the hypothesis

TYPES OF ERRORS
What are errors in Hypothesis
Testing?
The purpose of Hypothesis Testing is to reject or
not reject the Null Hypothesis based on statistical
evidence
Hypothesis Testing is said to have resulted in an
error when the decision regarding treatment of
the Null Hypothesis is wrong

TYPES OF ERRORS
Actual State of Affairs
Belief

Decision

H0 is True

H0 is False

H0 is False

Reject H0

Type I Error
False Positive

Correct Rejection
1-
Power

H0 is True

Fail to Reject H0

Correct Failure to
Reject
1-

Type II Error
False Negative

Statistical Power
1.

2.

Probability that the test will correctly reject a

false null hypothesis.
When a treatment effect exists
1.

A study may fail to discover it (Type II error, fail

to reject a false null hypothesis)

2.

A study may discover it (reject a false null

hypothesis)

AND THE INTER-RELATIONSHIP

During the Hypothesis Testing,

is the probability of occurrence of a Type-I Error
is the probability of occurrence of a Type-II Error

Relationship between and

For a fixed sample size, the lower we set value of ,

the higher is the value of and vice-versa

In many cases, it is difficult or almost impossible to

calculate the value of and hence we usually set
only

INTERPRETING RESULTS
Interpreting the weight of evidence against the
Null Hypothesis for rejecting / not rejecting Ho
If the p-value for testing Ho is less than

< 0.05, we have strong evidence that Ho is false

< 0.01, we have very strong evidence that Ho is false

< 0.001, we have extremely strong evidence that Ho is false

P value is taken as 0.05 or 5% because it is a standard icon & it

nearly corresponds to the difference of two standard errors.

Jurys Decision
Did Not Commit Crime

Committed Crime

Guilty

Type I Error
Convict Innocent
Person

Correct Verdict
Convict Guilty
Person

Not Guilty

Correct Acquittal
Type II Error
Fail to Convict Innocent Fail to Convict
Person
Guilty Person

Level of Significance
1. Alpha: probability of committing a Type
I error
1.

Reject H0 although it is true

2.

Symbolized by

2. Obtained result attributed to:

1.

Real effect (reject H0)

2.

Chance

One Sided & Two Sided Tests

Consider two means A & B.

One sided test only tells you that A > B.

Two sided tests tells you that either A>B or A <B so leaving you
with two options.

Mostly Two sided tests are used except in cases of equivalence

tests like Lumpectomy done for Breast surgery as well as radical
Mastectomy.

One sided test would be whether Lumpectomy is worst for

survival than Radical Mastectomy and we don't bother about
better survival results.

Any Questions !!!!

Thank

You.