STATISTICS &

PROBABILITY
 02
Elements of
Hypothesis Testing
 Objectives:
At the end of the lesson, you are expected to:
• understand the concept of Type I and Type II errors;
• connect error to the process of hypothesis testing;
• locate critical values under the normal curve
• determine critical values for hypothesis testing; and
• make a decision about the null hypothesis.
*The usual acceptable values of 𝛼 used are 0.05 and 0.01. If 𝛼 = 0.05, then the probability of rejecting a true
null hypothesis is 5%, which means that the probability of not rejecting a true null hypothesis is 95%. *
 TYPE I and TYPE II ERRORS
✓ If the null hypothesis is true and accepted, or if it is false and rejected, the
decision is correct

Type I Error Type II Error

✓ Accepting the null hypothesis when
✓ Rejecting the null hypothesis when it is false is called a Type II error
it is true is called a Type I error with with probability denoted by beta
probability denoted by alpha (𝛼). (𝜷).
✓ In hypothesis testing, the normal ✓ In hypothesis testing, the normal
curve that shows the critical region curve that shows the acceptance
is called the alpha region. region is called the beta region.
 TYPE I and TYPE II ERRORS

✓ The probability of
committing a Type 1
error is denoted by
the Greek letter 𝛼
(alpha), while the
probability of
committing a Type II
error is denoted by 𝛽
(beta).
 Rejection Region
➢ The rejection region (or critical region) is the set of all values of the test statistic
that causes us to reject the null hypothesis.

➢ The non – rejection region (or acceptance region) is the set of all values of the
test statistic that causes us to fail to reject the null hypothesis.

➢ The critical value is a point (boundary) on the test distribution that is compared
to the test statistic to determine if the null hypothesis would be rejected.
 LEVEL OF
SIGNIFICANCE
Level of Significance

➢ The level of significance denoted by alpha or 𝜶 refers to the degree of significance

in which we accept of reject the null hypothesis.

➢ 100% accuracy is not possible in accepting or rejecting a hypothesis.

➢ The significance level 𝜶 is also the probability of making the wrong decision when
the null hypothesis is true.
Two – tailed vs One – tailed test
Example:
She assumed that the average online usage of her friends is the same
as the global usage (𝐻0 )

She computer for the t – value using the formula

µ = 142 x = 152 s = 19.855 n = 10

152 −142
t= 19.855 t = 𝟏. 𝟓𝟗𝟑
10

df = n-1 = 10 – 1 = 9 Degree of freedom

One – tailed test at 5%
Example:
She assumed that the average online usage of her friends is the same
as the global usage (𝐻0 )

She computer for the t – value using the formula

µ = 142 x = 152 s = 19.855 n = 10

152 −142
t= 19.855 t = 𝟏. 𝟓𝟗𝟑
10

df = n-1 = 10 – 1 = 9
One – tailed test at 5%
Critical t – value is 1.833
Sketch a t – distribution curve

Null hypothesis: The average online usage of *The computed t – value is at the
her friends is the same as the global usage. non – rejection region.*

Alternatve hypothesis: The average online *We fail to reject the null
usage of her friends is higher than the global hypothesis*
usage.
Example:
A medical trial is conducted to test wheter or not a certain drug reduces cholesterol
level. Upon trial, the computed z – value of 2.715 lies in the rejection area.

Null hypothesis: The certain drug is effective in *The computed z – value is at the
reducing cholesterol level by 60%. rejection region.*

Alternatve hypothesis: The certain drug is not *We reject the null hypothesis in
effective in reducing cholesterol level by 60% favor of the alternative hypothesis.*
Example:
Sketch the rejection region of the test hypothesis with critical values of ±1.753 and
determine if the computed t – value of -1.52 lies in that region.

*We fail to reject the null hypothesis*

 REMEMBER!
➢ If the computed value is less than the critical value, the computed value is
located at the non – rejection region. It implies that we fail to reject the null
hypothesis. It means accept the null hypothesis.

➢ If the computed value is greater than the critical value, the computed value is
located at the rejection region. It implies that we reject the null hypothesis. It
means accept the alternative hypothesis.
Z - test and
T - test
There are two specific test statistics used for
hypothesis testing concerning means: z – test
and t – test.
Compute the z – value given the following information. Use one –
tailed test and 0.05 level of significance.
𝑥 = 71.5 𝜇 = 70 𝜎=8 n = 100

𝑥 − 𝜇 70 − 71.5
𝑧= 𝜎 = = 1.875
8
𝑛
100
In the first semester of the school year, a random sample of 200
students for a mean score of 81.72 with a population standard
deviation of 15 in Statistics and Probability test. The population
mean is 79.83. Use 0.05 level of significance.

𝑥 = 81.72 𝜇 = 79.83 𝜎 = 15 n = 200

𝑥 − 𝜇 81.72 − 79.83
𝑧= 𝜎 = = 1.782
15
𝑛
200
In the past, the average length of an outgoing call from a business
office has been 140 seconds. A manager wishes to check whether
that average has decrease after the introduction of policy changes. A
sample of 150 telephone calls produces a mean of 135 second, with a
standard deviation of 30 seconds.
𝑥 = 135 𝜇 = 140 𝜎 = 30 n = 150

𝑥 − 𝜇 135 − 140
𝑧= 𝜎 = = −2.041
30
𝑛
150
Compute the t – value given the following information:

𝑥 = 129.5 𝜇 = 127 𝑠=5 n = 12

𝑥 − 𝜇 129.5 − 127
𝑡= 𝑠 = = 1.736
5
𝑛
12
The government claims that the monthly expenses of a Filipino
family with four members is P10,000. A sample of 26 family’s
expenses has a mean of P10,900 and a standard deviation of P1, 250.
Is there enough evidence to reject the government’s claim at 𝛼 =
0.01?
𝑥 = 𝑃10,900 𝜇 = P10,000 𝑠 = 𝑃1,250 n = 26

𝑥 − 𝜇 10,900 − 10,000
𝑡= 𝑠 = = 3.671
1,250
𝑛 26