42 Statistics for mining engineering

The task of the general theory of testing statistical hypotheses is to formulate methods for
the construction of the best tests, i.e. the most powerful tests. However, in some cases such
tests do not exist. Thus, the further task of the theory is to indicate what to do when there is
no most powerful test.
Look more carefully at formula (1.98), which provides information about the probability
of making a type I error. If the verified hypothesis is rejected due to the information con-
tained in the sample, then it can be assessed that a rare event occurred because the probability
α is small. Moreover, if the event was Wn ∈ , then the assumption on the truthfulness of
the null hypothesis was wrong. In a case when the event will not happen, we can say that we
have no ground to discard the hypothesis. Notice, that we have no basis for evaluating the
hypothesis as a true one because true hypothesis can be different. Such a property of statis-
tical tests characterises tests of significance. These tests allow the verified hypothesis to be
rejected with a high probability when it is false. However, they do not allow the problem of
whether the null hypothesis is a true one to be resolved. The probability α is called the level
of significance. Thus, if this level is assumed to be 0.05 (this is the most frequently presumed
level of significance in engineering investigations), it means that taking 5 out of 100 cases on
average, the verified hypothesis will be rejected—based on the sample taken—despite the fact
that the hypothesis is a true one. The reason for the rejection is connected with the informa-
tion contained in samples and is not associated with the statistical procedure conducted.
Tests of significance are most frequently used in practice not only in the engineering field
and they are very simple in application.
Nonetheless, it should be noted that there is a certain freedom in the construction of tests of
significance and this freedom is not only connected with the arbitrary presumed level of signifi-
cance. Basically, there is independence in the selection of the statistic (estimator) which will be
used to estimate the unknown parameter of the general population in parametric tests or in a
different type of inference (in nonparametric tests of significance). Practically, the method of
the selection of the level of significance and the selection of the statistic alone is usually imposed
by what would be found in the literature on the subject. As was stated, the level of significance is
usually assumed to be α = 0.05 and it is a rare event when this level is higher or lower than that.
There is also a rule that is only one hypothesis is articulated presuming silently that the
alternative hypothesis is its negation in tests of significance. In addition, nothing is stated
about the level of the probability of a type II error.

When a parametric test of significance is applied, its procedure is as follows.

1. Formulate the basic hypothesis (null one) H0 stating that parameter q = q0, which means it
is suspected that the population of interest has a parameter q of q0 value
2. Take a sample of size n from the general population
3. Construct the statistic Q, which is a gauge (tester) of the verified hypothesis
4. Determine the probability distribution of the tester and find the critical region for the
presumed level α of significance; a condition to fulfil is:

P{Q ∈ | H0} = P {|Q – q0| > k } = α k > 0, (Figure 1.23) (1.102)

5. Make a decision based on the result of the investigation: reject the verified hypothesis or
there is no basis to discard it.
A different case can also be considered. If an estimation of the unknown parameter is
obtained using the information contained in the sample taken and its value is q̂ , then the
corresponding probability can be calculated from the formula:

P{|
{| − 0 | > q̂ˆ} = p (1.103)

Book.indb 42 12/9/2013 12:22:56 PM