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You are on page 1of 35

BY NARENDER SHARMA

2

Shakehand with Life

Corporate Training and Management Education

www.shakehandwithlife.in , www.shakehandwithlife.puzl.com

Leading Training, Coaching, Consulting services in Delhi NCR for Managers at all levels,

Future Managers and Engineers in MBA and B.E. / B. Tech.,

Students in Graduation and Post-Graduation, Researchers, Academicians.

Training with MS-Excel for managerial decision making skills,

Working with MS-Excel to solve all mathematical and statistical problem.

9468267324, 8684861131 9468267324

E-mail: shakehandwithlife@gmail.com

www.shakehandwithlife.in

3

What is Hypothesis?

being tested by scientific methods, that relates an

independent variables to some dependent

variable.

A hypothesis states what we are looking for and it is

a proportion which can be put to a test to

determine its validity

e.g.

Students who receive counseling will show a greater

increase in creativity than students not receiving

counseling

www.shakehandwithlife.in

4

Characteristics of Hypothesis

Capable of being tested.

Stated relationship between variables.

limited in scope and must be specific.

Stated as far as possible in most simple terms so that the same is

easily understand by all concerned. But one must remember that

simplicity of hypothesis has nothing to do with its significance.

Consistent with most known facts.

Responsive to testing with in a reasonable time. One cant spend a

life time collecting data to test it.

Explain what it claims to explain; it should have empirical reference.

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5

Null Hypothesis

sufficient statistical evidence to conclude otherwise.

Null Hypothesis is denoted by 0

If a population mean is equal to hypothesised mean

then Null Hypothesis can be written as

0 : = 0

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6

Alternative Hypothesis

hypothesis and is denoted by

If Null is given as 0 : = 0

: 0

: > 0

: < 0

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7

Level of significance and

confidence

null hypothesis when it is true and it is denoted by .

Generally taken as 1%, 5%, 10%

(1 ) is the confidence interval in which the null

hypothesis will exist when it is true.

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8

Risk of rejecting a Null Hypothesis

when it is true

Risk Confidence

Designation Description

More than $100 million

0.001 0.999

Supercritical (Large loss of life, e.g. nuclear

0.1% 99.9%

disaster

0.01 0.99 Less than $100 million

Critical

1% 99% (A few lives lost)

0.05 0.95 Less than $100 thousand

Important

5% 95% (No lives lost, injuries occur)

0.10 0.90 Less than $500

Moderate

10% 90% (No injuries occur)

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9

Type I and Type II Error

Decision

Null is true Correct Type I error

( )

( )

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Two tailed test @ 10

5% Significance level

regions in case of a Two Suitable When 0 : = 0

tailed test : 0

/ /

( = 0.025 2.5%) ( = 0.025 2.5%)

(1 ) = 95%

0 : = 0

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Left tailed test @ 11

5% Significance level

regions in case of a left tailed Suitable When 0 : = 0

test : < 0

/

( = 0.05 5%) (1 ) = 95%

0 : = 0

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Right tailed test @ 12

5% Significance level

regions in case of a Right Suitable When 0 : = 0

tailed test : > 0

/

(1 ) = 95% ( = 0.05 5%)

0 : = 0

www.shakehandwithlife.in

13

Procedure for Hypothesis

Testing

(Ho)and alternate significance level; statistics; z-test, t- value of test

(Ha) Hypothesis 1%, 5%, 10% etc. test, F-test. statistics

Compare

Calculate the p-

the p-value P-value >

value at given

with Calculated Accept Ho

significance level

calculated value

from the table

value

P-value <

Calculated Reject Ho

value

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14

Hypothesis

Testing of Z-TEST AND T-TEST

Means

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15

Z-Test for testing means

Population normal and

infinite

Sample size large or small, 0

Population variance is

=

known

Ha may be one-sided or

two sided

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16

Z-Test for testing means

Population normal and

finite,

Sample size large or small,

0

Population variance is =

known 1

Ha may be one-sided or

two sided

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17

Z-Test for testing means

Population is infinite and

may not be normal, 0

Sample size is large, =

Population variance is

unknown

Ha may be one-sided or

two sided

www.shakehandwithlife.in

18

Z-Test for testing means

Population is finite and may

not be normal, 0

=

Sample size is large, 1

Population variance is

unknown

Ha may be one-sided or

two sided

www.shakehandwithlife.in

19

T-Test for testing means

Population is infinite and

normal, 0

Sample size is small,

=

Population variance is

. . = 1

unknown

Ha may be one-sided or 2

two sided =

( 1)

www.shakehandwithlife.in

20

T-Test for testing means

Population is finite and 0

normal, =

1

Sample size is small,

Population variance is

. . = 1

unknown

Ha may be one-sided or 2

two sided =

( 1)

www.shakehandwithlife.in

21

Hypothesis

testing for

difference Z-TEST, T-TEST

between

means

www.shakehandwithlife.in

22

Z-Test for testing difference

between means

Populations are normal

Samples happen to be

large, 1 2

=

Population variances are 2 2

known 1 2

+

Ha may be one-sided or 1 2

two sided

www.shakehandwithlife.in

23

Z-Test for testing difference

between means

Populations are normal

Samples happen to be large,

Presumed to have been 1 2

drawn from the same

population =

1 1

Population variances are 2 +

known 1 2

Ha may be one-sided or two

sided

www.shakehandwithlife.in

24

T-Test for testing difference

between means

Samples happen to be small,

Presumed to have been

drawn from the same 1 2

population =

2 2

1 1 1 + 2 1 2 1 1

Population variances are +

unknown but assumed to be

1 + 2 2 1 2

equal

Ha may be one-sided or two . . = (1 + 2 2)

sided

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25

Hypothesis

Testing for

comparing PAIRED T-TEST

two related

samples

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26

Paired T-Test for comparing

two related samples

Samples happens to be 0

small =

.

Variances of the two

populations need not be ( 1) . .

equal

= Mean of differences

Populations are normal

. = Standard deviation of differences

Ha may be one sided or

two sided =

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27

Hypothesis

Testing of Z-TEST

proportions

www.shakehandwithlife.in

28

Z-test for testing of proportions

Use in case of qualitative

data

Sampling distribution may =

take the form of binomial .

probability distribution

Ha may be one sided or two

sided

=

= .

= . .

www.shakehandwithlife.in

29

Hypothesis

Testing for

difference Z-TEST

between

proportions

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30

Z-test for testing difference

between proportions

Sample drawn from two

1 2

different populations =

1 1 2 2

Test confirm, whether the +

1 2

difference between the

proportion of success is 1 = proportion of success in sample one

significant

2 = proportion of success in sample two

Ha may be one sided or

two sided

www.shakehandwithlife.in

31

Hypothesis

testing of

equality of F-TEST

variances of

two normal

populations

www.shakehandwithlife.in

F-Test for testing equality of 32

variances of two normal

populations

The populations are normal

2

Samples have been drawn 1

randomly

= 2

2

Observations are

independent; and 1 1 and 2 1 d. f.

There is no measurement

error

2

1 is the sample estimate for 1

2

2 is the sample estimate for 2

2

sided

www.shakehandwithlife.in

33

Limitations of the test of

Hypothesis

for decision making

Test does not explain the reasons as why the difference

exist, it only indicate that the difference is due to

fluctuations of sampling or because of other reasons but

the tests do not tell about the reason causing the

difference.

Tests are based on the probabilities and as such cannot be

expressed with full certainty.

Statistical inferences based on the significance tests

cannot be said to be entirely correct evidences

concerning the truth of the hypothesis.

www.shakehandwithlife.in

34

Thank You

35

Shakehand with Life

Corporate Training and Management Education

www.shakehandwithlife.in , www.shakehandwithlife.puzl.com

Leading Training, Coaching, Consulting services in Delhi NCR for Managers at all levels,

Future Managers and Engineers in MBA and B.E. / B. Tech.,

Students in Graduation and Post-Graduation, Researchers, Academicians.

Training with MS-Excel for managerial decision making skills,

Working with MS-Excel to solve all mathematical and statistical problem.

9468267324, 8684861131 9468267324

E-mail: shakehandwithlife@gmail.com

www.shakehandwithlife.in

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