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Types of Hypotheses

Types of hypotheses include: 1. Research hypotheses - statements about expected outcomes of experiments or studies. 2. Statistical hypotheses - more formal structures composed of the null hypothesis (Ho), which assumes no effect or change, and the alternative hypothesis (Ha), which proposes an effect. 3. Substantive hypotheses - statistically significant results do not necessarily imply material or substantive differences and depend on hypothesis testing outcomes. The process of hypothesis testing involves establishing hypotheses, determining an appropriate statistical test, setting significance levels, gathering sample data, analyzing results, reaching conclusions, and making business decisions. Type I and type II errors can occur.

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198 views3 pages

Types of Hypotheses

Types of hypotheses include: 1. Research hypotheses - statements about expected outcomes of experiments or studies. 2. Statistical hypotheses - more formal structures composed of the null hypothesis (Ho), which assumes no effect or change, and the alternative hypothesis (Ha), which proposes an effect. 3. Substantive hypotheses - statistically significant results do not necessarily imply material or substantive differences and depend on hypothesis testing outcomes. The process of hypothesis testing involves establishing hypotheses, determining an appropriate statistical test, setting significance levels, gathering sample data, analyzing results, reaching conclusions, and making business decisions. Type I and type II errors can occur.

Uploaded by

Chirag Rathod
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Types of Hypotheses

• 1. Research Hypothesis
• a statement of what the researcher believes will be the outcome of an experiment or a
study. (Assumption in word format or a statement format)
Example:-majority of customer like my newly launch product. (Assumption in word)

• 2. Statistical Hypotheses
• a more formal structure derived from the scientific method.(assumption in numbers, sign or
symbols)
Example: - on average 70% customer will like my product.
• Composed of two parts

• Null hypothesis (Ho) – the assumed value of the parameter if there is no


effect/impact. We will conclude that this could be true unless there is a small chance
of getting a sample statistic (mean/proportion/variance) as extreme as or more extreme
than from the data (small p-value).(explains neutral situation, no effect, no impact,
no change situation) {Segments}
Example: - >there is no effect in number of customer, if we launch new product
> at any cost or effort, we can’t get the result.

• Alternative hypothesis (Ha) – a statement of whether the true population parameter


is higher, lower, or not equal to that hypothesized in the null hypothesis.(there is a
change, positive or negative)
Example: - if we launch new product, Number of customer increased or decreased.

• 3. Substantive Hypotheses –
a statistically significant difference does not imply or mean a material, substantive
difference. (Decision is depended on hypothesis testing)
Example: - if 75% of customer will like my new product, i will launch new product in next
week.
• If the null hypothesis is rejected and the alternative hypothesis is accepted, then one can say
that a statistically significant result has been obtained
• With “significant” results, you reject the null hypothesis

One Tailed Test Two Tailed Test


Inequality
More, less, high, low, increase, Change, Equal, same
decrease

Using the HTAB System


• H – Hypotheses (Establish the hypotheses)
• T – Test (Conduct the test)
• A – Action (Take statistical action)
• B – Business Implications (Determine the business implications
Process of Hypothesis Testing
H 1 – Establish the null and alternative hypotheses
T 2 – Determine the appropriate statistical test
3 – Set α, the type I error rate / significance level
4 – Establish the decision rule (If 20 marks Gets, then pass Otherwise
Fail)
5 – Gather sample data
6 – Analyze/Test the data
A 7 – Reach a statistical conclusion
B 8 – Make a business decision

Inferential Statistic: - (Hypothesis Testing)


 My assumption for population, test the sample and conclusion decision for population.
 Example:- Cake (test only a piece)

Stage-3 Level Of Significant (LOS/α)

Example:-90% sure that student will score more than 20 marks in statistics.
 90% = Confidence Level/Surety about assumption
 10% = Risk of Rejecting assumption (Level Of Significant, α=10)

Error
Type I Error (α) (Serious Error) Answer is Correct and made a Wrong
(Example:- Innocent Person is
Punished)
Type II Error (β) Answer is Wrong and made a Right
Correct Decision Answer is Correct and made a Right
Answer is Wrong and made a Wrong

Decision Table for Hypothesis Testing


Decision Null (Truth)
Null True Null False
Not Reject (Accept) Correct Type II Error (β)
Reject Type I Error (α) Correct
α+β≠1 (Relate With Life)
1-β= Power of Test

Stage-4 Decision Rule

• A decision rule has to be made about when the difference between the sample and
hypothesized population mean (under the null hypothesis) is small or large.
• The rejection region is the area on the curve where the null hypothesis is rejected. Here the
value of the sample mean is too far from the hypothesized population mean to conclude that
they are the same.
• The non rejection region is the area where the null hypothesis is not rejected. Here the
sample mean is close enough to the hypothesized population mean to conclude that the null
hypothesis could be true.

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