Testing Hypothesis: One-

Sample Tests
Richard I Levin and David S Rubin’s
book on Statistics for Management-
Chapter 8
Contents
Concepts basic to hypothesis-testing
procedure
Testing hypothesis
Hypothesis testing of means when σ is
known
Measuring the Power of a hypothesis test
Hypothesis testing of proportions: Large
Samples
Hypothesis testing of means when σ 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
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 μ )
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 (σ )
Q) Based on the sample can the 10,000
Example continued
Question being asked =>
 If μ = 0.04 inch and σ = 0.004 inch
 What is the probability that a random sample with a
mean of
X  0.0408 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 company
Example continued
Converting to Z value

x  
z 
 x

where  x 
n

Z = 2 standard error away

from the mean
 Finding Probabilities Corresponding to Known Values

Hypothesized population
mean μ = 0.04

Sample mean =
0.0408
 X  0.0004 95.5 % of
area
2.28 % of
2.28 % of
 2 X area under
area under  2 X curve
curve

0.039 0.03 0.0 0.0 0.040

-32 -296 4
-1 40 0 8 1 Z Scale
2 3
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
company’s 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 = α = 4.56%