Scribd
Upload
12 views58 pages

Hypothesis Testing One Sample Full

Uploaded by

Ankit Singh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
12 views58 pages

Hypothesis Testing One Sample Full

Uploaded by

Ankit Singh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 58

Prof.

Tamalika Koley
Decision Sciences Area
Introduction - An Example
❑ A company is assuming (hypothesizing) that by providing a discount on their product, they can
achieve two specific outcomes: attracting more customers and increasing sales.

❑ This assumption (hypothesis) is based on the assumption that a lower price point will incentivize
potential customers to purchase the product.

❑ To test this assumption, the business might run a limited-time promotion where they offer a
discount on their product.
Continues…
•
Summary

A business hypothesis is an educated guess about a particular aspect of a business


that is formulated to guide experiments and data analysis, ultimately leading to
informed business decisions.
Statistical Hypothesis
❑ A hypothesis is an assumption/statement about the population parameter.

❑ Recall: Parameter is characteristic of unknown population.

❑ It is a claim about the unknown population.

❑ Example: In the previous business example, “offering a


discount on product, will attract more customers and increase
sales”.
Types of Hypothesis
•
Examples
•
Example
•
Example-Business
•
Exercise
Obesity is a major health problem today. Research is starting to show that people may be able to
lose more weight on a low carbohydrate diet than on a low fat diet.

1. Frame the research question.


2. State the null and alternative hypotheses for the research problem stated in (1).
Test of Hypothesis
❑ A rule, which when the sample values have been obtained, leads to a decision to accept or reject
the hypothesis under consideration.

❑ Example: Hypothesis: A coin is fair.

Test: Reject the hypothesis if in 5 tosses of a coin 1 head or 5 heads are obtained.

Hypothesis testing
Types of Errors
Errors
•
Type – I & Type – II Errors
•
Example – Court Trial Room
•
Example
Graphical Representation of Errors

❑ For a given data, reduction of both the errors simultaneously not possible!!
Solution
•
Steps of Hypothesis Testing
•
Steps

Step IV: Determine the critical value from the table using the distribution of the test statistic under
null hypothesis.

Step V: Calculate the test statistic value using the sample data points.

Step VI (Making Decisions): If computed value is greater than the tabulated value reject the null
hypothesis, otherwise accept it.
Flow Chart
•

One – tail test


•
Decision Rule
•
P-value
❑ Quantifies the evidence against a null hypothesis.
❑ A p-value measures the probability of obtaining the observed results, assuming that the null
hypothesis is true.
Continues…
•
Example – I
Pepsi's dispensing machine is designed to fill bottles with exactly 2 litres of their product.
To test if the machine is performing according to specification, we collect a sample of 100 2-litres
bottles.
The average quantity content in the sampled bottle is 1.985 litres and the population standard
deviation of the fill is known to be 0.05 litre.

Test whether the machine is in control, at the 5% level of significance.


Solution
•
Continues…
•
P-value
•
Exercise
•
Solution
•
Continues…
•
P-value
•
•
Continues…
•
P-value
Example - I
•
Solution
•
Decision
•
P-value
•
Example
•
Solution
•
Solution
•
•
Testing
•
P-value
Example
A botanist has produced a new variety of hybrid soy plant that is better able to withstand drought
than other varieties. The botanist knows the seed germination for the parent plants is 75%, but
does not know the seed germination for the new hybrid. He tests the claim that it is different from
the parent plants.

To test this claim, 450 seeds from the hybrid plant are tested and 321 have germinated.

Use a 5% level of significance to test this claim that the germination rate is different from 75%.
Solution
•
Solution
•
P-value
•
•
Testing
•
Decision Rule
•
Example
•
Solution
•
Solution
•
Exercise

Calculate the p-value and interpret the result.

You might also like