Chapter-17 (Book-1)

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Hypothesis

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 What is hypothesis?
In statistics, a hypothesis is a statement that is made about a population
parameter.

Examples:
1. More students get sick during the final week of testing than at other
times.
2. Worker satisfaction increases worker productivity.
3. The coin is unbiased (i.e p=0.5)
4. The court assumes that the indicted person is innocent.

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Hypothesis testing
Hypothesis testing is a statistical method used
to determine whether a hypothesis about a
population parameter is supported by the
sample data.

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Null Hypothesis
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Alternative Hypothesis
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Example
 For example, suppose we want to test whether
a new drug is effective in treating a certain
disease. The null hypothesis would be that the
drug is not effective, while the alternative
hypothesis would be that the drug is effective.

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Five Steps of Hypothesis Testing

1. State the null and alternative hypotheses: The null hypothesis is
the hypothesis that there is no significant difference between a
specified population parameter and a hypothesized value. The
alternative hypothesis is the hypothesis that there is a significant
difference between the population parameter and the hypothesized
value.
2. Determine the level of significance: The level of significance is the
probability of rejecting the null hypothesis when it is actually true. It is
usually set at 0.05 or 0.01.

3. Calculate the test statistic: The test statistic is a numerical value

that is used to determine whether the null hypothesis should be
rejected. The test statistic is calculated using the sample data and the
null hypothesis.

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 Five Steps of Hypothesis Testing
4. Determine the critical value: The critical value is the
value that separates the rejection region from the
non-rejection region. The critical value is determined by
the level of significance and the degrees of freedom.

5. Make a decision: Based on the calculated test statistic

and the critical value, the null hypothesis is either
rejected or not rejected. If the test statistic falls in the
rejection region, the null hypothesis is rejected. If the test
statistic falls in the non-rejection region, the null
hypothesis is not rejected.
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A researcher reports that the average salary of assistant professors

is equal to $42,000. Several researchers disagreed with the report
and claimed that the salary of assistant professors is different
from $42,000. To investigate, a random sample of 35 assistant
professors has a mean salary $43,260, and the standard deviation
was $5230.
a. Set the null hypothesis and alternative hypothesis. b. Analysis
of the claim statement, true or not, by using a 5% level of
significance.

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b. Analysis of the claim statement, true or not, by using a

5% level of significance.

Answer:

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Using a z-table with a 5% level of significance, the critical values

are ±1.96.
Since the calculated z-value (1.43) is smaller than the critical
value (1.96), we do not reject the null hypothesis and conclude
that there is no evidence to suggest that the average salary of
assistant professors different from $42,000 at a 5% level of
significance.

Therefore, the claim statement that the salary of assistant

professors is different from $42,000, which is not true at a 5%
level of significance.

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Using a z-table with a 5% level of significance, the critical values

are ±1.96.
Since the calculated z-value (2.19) is greater than the critical
value (1.96), we do not reject the null hypothesis and conclude
that there is no evidence to suggest that the average salary of
assistant professors is different from $42,000 at a 5% level of
significance.

Therefore, the claim statement that the salary of assistant

professors is different from $42,000, which is not true at a 5%
level of significance.

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Critical value for z-Test

 Level of 0.10 0.05 0.01 0.005 0.002
significance

Critical -1.28 or -1.645 or -2.33 or -2.58 or -2.88 or

values of 1.28 1.645 2.33 2.58 2.88
z for one
tailed test
Critical -1.645 -1.96 -2.58 -2.81 -3.08
values of and and and and and
z for two 1.645 1.96 2.58 2.81 3.08
tailed test

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t-Test table
• If the test is two-tailed or if you’re calculating a confidence
interval, use the first table. If the test is one-tailed, use the
second table.
• The degrees of freedom (df) are listed along the left side of the
table. Find the table row for the df you calculated in Step 2. If
you need a df that isn’t listed, then round down to the next
smallest number (e.g., use df = 40 instead of df = 46).
• The significance levels are listed along the top of the table. Find
the column for the significance level that you chose in Step 3.
In most cases, you will use the highlighted column (α = .05).
• The critical value of t for your test is found where the row and
column meet.

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 HW

Write down the difference between z test and t

test.

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 Index Number

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Suppose ,in 2019,Laspyre's price index for some

items(Beef, Mutton and Chicken) is 150% and
Pasche's price index for same items is 171%
compared to 2005.
Determine the relative change by using Fisher's
price index and comment about your result.

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 Sampling Methods

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Sampling Technique

The sample selection procedure basically

 originated the concept of sampling
technique in statistics.

Usually, populations are so large that a

researcher cannot examine the entire group.

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Types of Sampling
Technique
 Sampling

Non

Probability Probability

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HW
Difference between probability and non-probability
sampling.

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Some Statistical Terms

Sampling Frame: The list of all sampling units with proper
identification.
✔ Student’s ID registered in DU.
✔ List of bus drivers in Dhaka.
✔ List of fish processing workers in Khulna.

Sampling Unit: A particular unit from the sample is known

as a sampling unit.
✔ Students from each department of DU.
✔ Bus drivers from each bus station in Dhaka. ✔
Fish processing workers from each fish hatchery of
Khulna.

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 Simple Random
Sampling
✔ Each element has an equal probability of
being selected.

✔ It is a basic type of sampling.

✔ It requires a complete sampling frame and

a homogeneous set of units. (Criteria)

✔ Tools like the lottery method or random

number generator are applied.
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Situation of using SRS

When population have a complete sampling frame, units

are homogeneous and it ensures to share equal chance
to get in sampling for each draw.

We can use SRS in that situation.

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Simple Random Sampling (SRS)

For example,

You want to select a

simple
random sample of 04
persons from a household.
You assign a number to
every household member
 from 1 to 14 and use a
lottery method to select 04
numbers.
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Stratified Sampling
✔ A way where the population is divided into
mutually exclusive subgroups (called strata) and then
the selection of elements from each subgroup is
accomplished by using random sampling.

✔ The sample size from each stratum is determined by

allocating rules (e.g., arbitrary, equal, proportional).
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Stratified Sampling
✔ The process of creating subgroups is based on a
relevant characteristic (e.g., gender, age range, income
bracket, job role).

✔ The elements of strata must be homogenous

internally but heterogeneous externally.
✔ It requires a complete sampling frame and
a heterogeneous set of units (Criteria).

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Stratified Sampling
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Real Life Problem

 ✔ Wish to calculate the number of students in
secondary school in Dhaka city.

✔ The school size is differed in terms of students’

number (e.g., small, middle, and large)

✔ Large school contains greater quantity of students. ✔

If SRS is applied here, it is very possible to create the
sample with too many of students from the large school.
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Real Life Problem

✔ The sample will not be representative of the
population (using SRS).

What is the solution????

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Situation of using Stratified

 Sampling
✔ Divide (stratify) the schools (sampling units) before
the sampling based on the size of the school (small,
middle, and large).

✔ Select sample from each of the three groups by

using SRS.

✔ Calculate total number of students by

combining results of the three groups.
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