Identifying Appropriate Form of Test Statistic and Identifying the Appropriate

Rejection Region for a Given Level of Significance

What Is This Module About?

To compute the test statistic value in hypothesis testing, there is a need to get

equipped with an understanding of which appropriate form of the test statistic is

utilized. This module presents ways how to deal with such tests appropriately.

The learning material is divided into two lessons namely:

Lesson 1 – Identifying Appropriate Form of Test Statistic

Lesson 2 – Identifying the Appropriate Rejection Region for a Given Level of

Significance

What Will You Learn From This Module?

After studying this module, you should be able to:

 Identify the appropriate form test statistic when

a) the population variance is assumed to be known

b) the population variance is assumed to be unknown

 c) the Central Limit Theorem is to be used

 Identify the appropriate rejection region for a given level of significance

when

a) the population variance is assumed to be known

b) the population variance is assumed to be unknown

c) the Central Limit Theorem is to be used

Wait!

It would be easier to understand the lessons in this material if you have the prior

understanding of the following topics:

 Illustrating hypothesis and other terms related to hypothesis testing

 Parameter and test statistic

 One-tailed and two-tailed test

The concepts in the said topics will aid you in identifying appropriate form of

test statistic as well as appropriate rejection region for a given level of

significance.
 Let’s Remember

Variance is a measure of how data points differ from the mean. It is a measure

of how far a set of data (numbers) are spread out from their mean (average) value.

Variance means to find the expected difference of deviation from actual value and

the standard deviation gives a rough estimate of it. Standard deviation is obtained

after getting the square root of the variance. In this lesson, most problems and

situations will use the standard deviation to facilitate discussion.

Let’s See What You Already Know

Before we get into the core of the lesson, let us try to check your prior

knowledge of the characteristics of z-distribution and t-distribution. Try answering

the exercise below:

A. Direction: Write the letter “z” if the statement is a characteristic of

standard normal distribution and “t” if the given characteristic describes

t-distribution.

______ 1. It is best applied if you have a limited sample size 𝑛 < 30 as

long as the variables are approximately normally distributed.

______ 2. It is also applicable if you do not know the population’s

standard deviation.
 ______ 3. This is best to use in a statistical test if the population standard

deviation is known.

______ 4. It is always used for normal distribution.

______ 5. This test is often applied in large samples (𝑛 ≥ 30)

B. Direction: Identify the data present in the given situations that may be

used in statistical tests. (population mean, sample mean, population

standard deviation, sample size, etc.)

1. A Grade 11 researcher reported that the average allowance of Senior

High School students was more than P80. A sample of 35 students had

mean allowance of P100. At 𝛼= 0.01 test, it was the claim that the

students had allowance of more than P80. The standard deviation of the

population is P40.

2. According to a cell phone company, the average price of cellular phone

in the Philippines is P12,999. However, in a sample of 20 costumers

randomly asked about the price of their cellular phone, data collected

showed an average of P9,999 and standard deviation of P7,999. Using

𝛼 = 0.05 level of significance, is there enough evidence proving that the

 average price of cellular phone is less than P12,999?

3. The average number of ad clicks per day for Facebook before was

192,000 and the standard deviation was 100,000. Sixty-four (64) days

after the redesign, the mean number of ad clicks per day was 200,000.

4. The average life of typical incandescent bulb is 1,500 hours as claimed

by a light bulb company. Thinking that the average life of bulbs is less

than what the company claimed, a client tested a random sample of 55

light bulbs. The rest resulted to sample mean of 1,300 hours and

standard deviation of 25 hours. Is there enough evidence to prove that

the average life of the company's light bulb is less than 1,500 hours?

5. The heights of a random sample of 100 entering HRM freshman of a

certain college is 157 cm with a standard deviation of 8 cm. Test the

data against the claim that the overall height of all entering HRM

students is 160 cm. Previous studies showed that σ = 5 cm.

C. Direction: Illustrate the rejection region given the critical value and

identify if the t values lie in the acceptance region or rejection region.

 1. critical t-value of 1.318 computed t-value of 1.1 The computed t-

value is at the ________________ region.

2. critical t-value of -1.671; computed t-value of -2.45 The computed

t-value is at the _______________ region.

3. critical t-value of 1.725; computed t-value of 2.14 The computed t-

value is at the ______________region.

4. critical t-value of ±1.311; computed t-value of -1.134 The

computed t-value is at the _______________region.

5. critical t-value of -1.70; computed t-value of -2.48. The computed

t-value is at the ______________ region.

LESSON 1

Identifying Appropriate Form of Test Statistic

A claim or hypothesis regarding a parameter in a population is tested using the

hypothesis testing technique using a data sample. Using this technique, we check whether

the population parameter hypotheses were correct as well as the likelihood that the sample

statistic might be chosen. Setting up the null hypothesis and the alternative hypothesis as

two opposing hypotheses is the first step in the hypothesis testing procedure. A random

sample is chosen, and summary statistics are computed after determining the likelihood
that the sample data support the alternative hypothesis, using the appropriate test statistics.

You learned how to create null and alternative hypotheses in the previous module.

You are now prepared to examine statistical evidence to ascertain the correct test statistics

to be used in computing the results and making decisions.

Let’s Learn

In the previous lessons, you learned the basic concepts of random sampling,

parameter, and statistic. In this lesson, we will use them to determine the needed data in

identifying the appropriate form of test statistic.

Let us look back to the important terms needed in our lesson.

Definition of Terms:

TERM MEANING

Population It includes all the elements from a set of data

Sample It consists of one or more observations from the

populations

Sample mean (x̄) The mean of the sample values collected

Population mean (µ) The mean of all the values in the population. If the
 sample is randomly selected and sample size is large then

the sample mean would be a good estimate of the

population mean

Population standard is a parameter which is a measure of variability with fixed

deviation (σ) value calculated from every individual in the population

Sample standard is a statistic which means that this measure of variability

deviation (s) is calculated from only some of the individuals in a

population.

Population variance It indicates how the population data points are spread out.

(𝛔𝟐 ) It is the average of the distances from each d point in the

population to the mean, squared.

A Test Statistic is a random variable that is

calculated from sample data and used in a
hypothesis test.

The test statistic shows how closely your observed data matches the distribution

expected under the null hypothesis of that statistical test. The use of test statistic is to

determine whether to accept or reject the null hypothesis. It compares the data with what

is expected under the null hypothesis.

 Knowing which test statistic is to be used depends upon knowing if the population

variance or standard deviation is known or unknown. The table below shows the

difference between z-test and t-test and will guide you on how to use the test.

z-test t-test

The population standard deviation (σ) is A t-test is used when the population

known. variance or standard deviation (σ) is not

known.
The population is normally distributed.

The population is normal or nearly

A z-score is calculated with population
normally distributed
parameters.

The sample size is less than 30 (n < 30)

It is used to validate a hypothesis that

the sample drawn belongs to the same It is used to validate a hypothesis that the

population. sample drawn belongs to the same

population.
The sample size is large (n ≥30)

The sample size is large (n ≥30)

[extremely large as defined by the Central

Limit Theorem]

However, the Central Limit Theorem is used in Statistics and Probability dealing
with the distribution of a sample variable in approximating a normal distribution (i.e., a

“bell curve”) as the sample size becomes larger, assuming that all samples are identical

in size, and regardless of the population's actual distribution shape.

Put another way, CLT is a statistical premise that, given a sufficiently large sample

size from a population with a finite level of variance, the mean of all sampled variables

from the same population will be approximately equal to the mean of the whole

population. Furthermore, these samples approximate a normal distribution, with their

variances being approximately equal to the variance of the population as the sample size

gets larger, according to the law of large numbers.

Central Limit Theorem

In Central Limit Theorem, if the population is normally

distributed or the sample size is large and the true population

mean µ = µ0 , then z has a standard normal distribution.

When the sample size is extremely large, and the variance is

unknown.

The sample standard deviation (s) may be used as an estimate

of the population standard deviation (σ) when the value of σ

is unknown.

Summing it up, the following is a simplistic diagram that specify when to use the
 z-test vs t-test.

Note some of the following in the above diagram:

 If the population standard deviation is known and the sample size is

greater than 30, z-test is recommended to be used.

 If the population standard deviation is known, and the size of the sample is

less than or equal to 30, T-test is recommended.

 If the population standard deviation is unknown, T-test is recommended.

The z-test and t-test are different statistical hypothesis tests that help determine

whether there is a difference between two population means or proportions. The z-

statistic is used to test for the null hypothesis in relation to whether there is a difference

between the populations means or proportions given the population standard deviation is
known, data belongs to normal distribution, and sample size is larger enough (greater

than 30). T-tests are used when the population standard deviation is unknown, the data

belongs to a normal distribution and the sample size is small (lesser than 30).

Identifying Appropriate Form of Test Statistic

Example 1: A manufacturer claimed that the average life of batteries used in

their electronic games is 150 hours. It is known that the standard deviation

of this type of battery is 20 hours. A consumer wished to test the

manufacturer's claim and accordingly tested 100 electronic games using the

battery. It was found out that the mean is equal to 144 hours. Identify the

appropriate test statistic to be used.

Solution: Use the diagram previously presented to determine the given data.

 Is the population standard deviation known or unknown?

 What is the sample size?

 Is n ≥ 30 or n <30?

σ is σ is n ≥ 30 n <30 z-test t-test

known unknown

✓ ✓ ✓
 In the given problem, 100 electronic games were tested using the battery which

reveals a sample size of more than 30. Also, the population standard deviation is

known as stated to be 20 hours. Thus, z-test will be used.

Example 2: An English teacher wanted to test whether the mean reading speed

of students is 250 words per minute. A sample of 12 students revealed a

sample mean of 240 words per minute with a standard deviation of 5 words

per minute. At 0.05 significance level, is the reading speed different from

550 words per minute?

Solution: Based on the problem above, the sample size is 12, so n<30. Is the

population standard deviation known? Do not get mistaken by the statement

in the problem, “A sample of 12 students revealed a sample mean of 540

words per minute with a standard deviation of 5 words per minute. You may

mistakenly get 5 as the standard deviation, but note that 5 in this problem is

a sample standard deviation and the population standard deviation is not

given.

Since the population variance is unknown and the sample size is

less than 30, t-test will be used.

 σ is σ is n ≥ 30 n <30 z-test t-test

known unknown

✓ ✓ ✓

Example 3: A study was conducted to look at the average time students exercise.

A researcher claimed that in average, students exercise less than 15 hours per

month. In a random sample size n =115, it was found that the mean time

students exercise is x̄ = 11.3 hours per month with s = 6.43 hours per month.

Solution: The sample size in this problem n = 115, is extremely large and the

standard deviation of s= 6.43 hours per month is a sample standard deviation.

The population standard deviation is unknown.

According to the Central Limit Theorem, when the sample size

greater than or equal to 30, and the population standard deviation is

unknown, z-test is used.

σ is σ is n ≥ 30 n <30 z-test t-test

 known unknown

✓ ✓ ✓

Example 4: It is claimed that the average age of working students in a certain

university is 35. A researcher selected a random sample of 25 working

students. The computation of their ages resulted to an average of 32 years

with standard deviation of 10 years.

Solution: Determine the sample size: 25 working students (n < 30)

Population variance is unknown.

σ is σ is n ≥ 30 n <30 z-test t-test

known unknown

✓ ✓ ✓

Let’s Try This

Direction: Read each problem or situation and identify the appropriate form of test statistic

to be used.

1. Bryan administered Mathematics achievement test to random sample of

50 graduating pupils . In this sample, x̄ = 90 and s = 10. The population

parameters are µ=83 and σ=15.

2. A school administrator claims that less than 50% of the students of the school

are dissatisfied by the community cafeteria service. Test this claim by using

sample data obtained from a survey of 500 students of the school where 54%

indicated their dissatisfaction of the community cafeteria service. Use a =

0.05.

3. A researcher used a developed problem solving test to randomly select 50

Grade 6 pupils. In this sample, X = 80 and s = 10. The mean u and the

standard deviation of the population used in the standardization of the test

were 75 and 15, respectively.

4. A sample of five measurements, randomly selected from an approximately

normally distributed population, resulted in the summary statistics: mean =

4.6, s=15. Test the null hypothesis that the mean of the population is 6

against the alternative hypothesis μ < 6. Use a = 0.05.

5. According to a factory employer, the mean working time of workers in the

factory is 6 hours with a standard deviation of 0.5 hours. A researcher

 interviewed 50% of the employees and found out that their mean working

time is 8 hours with a standard deviation of 1 hour. The α level is 0.05.

LESSON 2

Identifying the Appropriate Rejection Region for

a Given Level of Significance

One of the processes in hypothesis testing is the calculation of the test statistic.

It is used to determine the probability needed in decision-making. In the traditional method

of hypothesis testing, the test statistic is the value, determined by a computational formula

that is compared with a confidence coefficient (like 1.96 and 2.58). The decision that we

make depends on the computed test statistic whether we accept or reject the null hypothesis.

The image below shows the acceptance and rejection region under the normal curve

considering the tailed test.

 Let’s Learn

The REJECTION REGION, also known as 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 LEVEL OF SIGNIFICANCE is defined as the quality of being

statistically significant. This is denoted by alpha α, which refers to the degree of

significance in which we accept or reject the null hypothesis.

The CRITICAL VALUE is a

point (boundary) on the test distribution that

is compared to test statistic to determine if

the null hypothesis would be rejected.

For one-tailed test or directional test <, the

critical region is at the left side of the

acceptance region.

For one-tailed test or directional test >, the

critical region is at the right side of the

acceptance region.

For two-tailed test or non-directional test ≠,

the critical region is at the left and right sides of

the acceptance region. The confidence

coefficient is divided by 2.

Identifying Appropriate Rejection Region for a Given Level of Significance

Steps in the Traditional Method of Hypothesis Testing

Step 1 Describe the population parameter of interest (e.g., mean, proportion)

 Step 2 Formulate the hypotheses: the null hypothesis and the alternative

hypothesis.

Step 3 Check the assumptions

 Is the sample size large enough to apply the Central Limit Theorem
(CLT)?

Step 4 Determine (Choose) a significance level size for α.

 Is the test two-tailed or one-tailed?

 Get the critical values from the test statistic table.

 Establish the critical regions.

 Draw a normal curve, draw vertical lines through the critical

values, and shade the rejection region.

Step 5 Select the appropriate test statistic.

 Compute the test statistic using the appropriate formula

Step 6 Compare the computed test statistic and the critical value. Then, based on
the decision rule, decide whether to reject or not to reject the null
hypothesis.

For purposes of facilitating the examples below, the solution will go directly to

the steps necessary in this lesson as prior steps were discussed in the previous

modules, and will only show the rejection (acceptance) region.

Illustrative examples:

Example 1: A manufacturer claimed that the average life of batteries used in

their electronic games is 150 hours. It is known that the standard deviation

of this type of battery is 20 hours. A consumer wished to test the

 manufacturer's claim and accordingly tested 100 electronic games using the

battery. It was found that the mean is equal to 144 hours. Use α = 0.05.

Solution: Based on the discussion in Lesson 1, we need to determine first if the

population standard deviation is given or unknown and determine the sample

size. In this problem, the population standard deviation is given to be 20 hours,

and the sample size s =100 electronic games. The population standard deviation

is known; the sample indicates n ≥ 30; therefore, z-test will be used. Likewise, it

will use two-tailed test determined by the “average life of batteries used in their

electronic games is 150 hours”, or µ = 150, your null hypothesis

H0 : µ = 150. And the alternative hypothesis, H𝑎 : µ ≠ 150.

The curve below shows the rejection region and the critical value

(±1.96 )defined by α = 0.05 (two-tailed: 0.025). If the computed z-value lies

within the rejection region, we reject the null hypothesis. Otherwise, accept the

null hypothesis
Example 2: According to a survey, the average daily usage of social media

worldwide of global internet users amounts to 142 minutes per day. Sofia

conducts her own survey among her 10 friends to find out if her time spent

on social media is significantly higher than the global survey. α = 0.05.

Solution: H0 : The average daily usage of social media of her friends is the same as the

global average usage.

H𝑎 : The average daily usage of social media of her friends is higher than the

global average usage.

The alternative hypothesis includes the term “higher than”, so this problem

is a one-tailed test. Investigating the problem, it will use t-test since the

population standard deviation and the sample size in less than 30. (Refer to the

previous lessons in finding the t-value). After computing for the t-value, which

in this case is, the computed t is 𝑡𝑐𝑜𝑚𝑝𝑢𝑡𝑒𝑑 = 1.593, determine the critical value.

The critical t-value in this situation is 𝑡𝑐𝑟𝑖𝑡𝑖𝑐𝑎𝑙 = 1.833.

 The computed t-value falls under the non-rejection region

(acceptance region). When the computed value is lower than the critical value, it is

under non-rejection rejection. Therefore, it will mean failing to reject the null

hypothesis or ACCEPT THE NULL HYPOTHESIS.

Example 3: Sketch the rejection region of the test hypothesis with critical

values of −2.715 and determine if the computed t-value of -1.52 lies in that

region.

Solution:

The computed t-value is at the non-rejection region. Therefore, we fail to

reject the null hypothesis.

Let’s Try This

Direction: Read each problem or situation and determine if the computed t-value or z-value
lies in the rejection region or non-rejection region.

1. A researcher used a developed problem-solving test to randomly select 50

Grade 6 pupils. In this sample, sample mean = 80 and s = 10. The mean µ

and the standard deviation of the population used in the standardization of

the test were 75 and 15, respectively. Use the 95% confidence in determining

if the sample mean differ significantly from the population mean.

2. A school administrator claims that less than 50% of the students of the school

are dissatisfied by the community cafeteria service. Test this claim by using

sample data obtained from a survey of 500 students of the school where 54%

indicated their dissatisfaction of the community cafeteria service. Use α =

0.05.

3. A researcher used a developed problem-solving test to randomly select 50

Grade 6 pupils. In this sample, X = 80 and s = 10. The mean u and the

standard deviation of the population used in the standardization of the test

were 75 and 15, respectively.

4. A librarian of a school claims that all their grade 8 students read an average

of 10 storybooks a month with a standard deviation of 2 books. A random

sample of grade 8 students read an average 12 books a month and a standard

deviation of 1 book. The confidence statement is 95%.

5. According to a factory employer, the mean working time of workers in the

 factory is 6 hours with a standard deviation of 0.5 hours. A researcher

interviewed 50% of the employees and found out that their mean working

time is 8 hours with a standard deviation of 1 hour. The α level is 0.05.

Let’s Remember

 A sample point is a possible outcome.

It is best applied if you

What Have You Learned?

A. Direction: Tell which test statistic (z-test or t-test) must be used in each of

the given situations.

1. A statistical test that is used to check if the means of two data sets are different

when the population variance is known.

2. The data follows a student-t distribution.

 3. A test used to check if the means of two data sets are different when the

population variance is not known.

4. A statistical test that is conducted on normally distributed data to check if there

is a difference in means of two data sets.

5. The sample size is lesser than 30.

B. Direction: Determine if the computed t-value or z-value lies in the rejection

region or non-rejection region.

1. The owner of a factory that sells a particular bottled fruit juice claims that the

average capacity of their product is 250 ml. To test the claim, a consumer

group gets a sample of 100 such bottles, calculates the capacity of each bottle,

and then finds the mean capacity to be 248 ml. The standard deviation s is 5

ml. Is the claim true?

2. A sample of five measurements, randomly selected from an approximately

normally distributed population, resulted in the summary statistics: mean = 4.6,

s=15. Test the null hypothesis that the mean of the population is 6 against the

alternative hypothesis μ < 6. Use a = 0.05.

3. A sample of five measurements, randomly selected from an approximately

normally distributed population, resulted in the summary statistics: X = 4.6,

s=15. Test the null hypothesis that the mean of the population is 6 against the

alternative hypothesis μ = 6. Use α = 0.05.

 4. α = 0.05, z = 2.5, two-tailed

5. α = 0.05, z = -1.645, one-tailed

Answer Key

 Let’s See What You Already Know

A. Direction: Write the letter “z” if the statement is a characteristic of standard

normal distribution and “t” if the given characteristic describes t-

distribution.

1. t

2. t

3. t

4. z

5. z

B. Direction: Identify the data present in the given situations that may be used

in statistical tests (population mean, sample mean, population standard

deviation, sample size, etc.)

1. 𝜇 = 80, 𝑛 = 35, x̄ = 100, α = 0.01, s = 40

2. 𝜇 = 12,999, 𝑛 = 20, x̄ = 9,999, α = 0.05, s = 7,999

 3. 𝜇 = 192, 000, 𝜎 = 100,000 x̄ = 200,000

4. 𝜇 = 1,500, 𝑛 = 55, 𝜎 = 25, x̄ = 1,300

5. 𝜇 = 160 𝑛 = 100, 𝜎 = 5 𝑠 = 8, x̄ = 157

C. Direction: Illustrate the rejection region given the critical value and identify

if the t values lie in the acceptance region or rejection region.

1. acceptance

2. rejection

3. rejection

4. acceptance

5. rejection

 Let’s Try This

Direction: Read each problem or situation and identify the appropriate form of test

statistic to be used.

1. z-test

2. z-test

3. z-test

4. t-test

5. z-test

 What Have You Learned?

 A. Direction: Tell which test statistic (z-test or t-test) must be used in each of

the given situations.

1. z-test

2. t-test

3. t-test

4. z-test

5. t-test

B. Direction: Determine if the computed t-value or z-value lies in the rejection

region or non-rejection region.

1. Rejection region

2. Non-rejection region

3. Non-rejection region

4. Rejection region

5. Rejection region

References

Belecina, et.al. (2016). Statistics and Probability. Manila: Rex Bookstore.

BYJU'S. (2022). Retrieved from BYJU'S: https://byjus.com/maths/variance/
Data Analytics. (2022). Retrieved from Vitaflux: https://vitalflux.com/when-to-use-z-
test-vs-t-test-differences-examples/
Investopedia. (2022). Retrieved from Investopedia:
https://www.investopedia.com/terms/c/central_limit_theorem.asp
Study.com. (2022). Retrieved from Study.com: view-
source:https://study.com/academy/practice/quiz-worksheet-z-test-vs-t-test.html
Wow Math. (2021, May 11). Retrieved from Youtube.com:
https://www.youtube.com/watch?v=GAJFUDcpdZg&t=866s