6.

2 Testing for M when o known

Setup Xin i kn id NG o l O is known

So far Derive estimator it point estimate

CI for M interval estimate
Study asymptotic properties of it
Bias Var MSE efficiency
Now Given iid data we want to make a
binary decision
guilty not guilty
allow not allow new treatment
etc
 Hypothesis Testing the use of probability theory and
statistics to decide 2 options while recognizing the randomness
of events data
4

The 2 options
The null hypothesis Ho is usually a statement of
the status quo i.e nothing interesting is going on

The alternative hypothesisH or Ha is a theory that

interests you before any data are collected This is usually
the finding you want to happen
 e

statistic

Step 1 Define parameter s and set up hypothesis ignoring data

Let u avg speed reading for vehicles traveling at 65 mph

We want to test constant

Ho M 65 Form of null hypothesis Ho

nyt
H M 65 The problem tells us how to form Hi
In this case it is a one sided alternative
ble we are interested in over reporting
Step 2 Assume for the moment that Ho is true Find the
sampling dist for the statistic you applied to your
data assuming Ho
istme.fi
sample mean I
Find the distribution of X assumming Ho is true
If Ho M 65 is true then Xi in MN 65 12

Recall Xin xn id N u 04 In NCM E

So In N 65 Jo assuming Ho is true
Step 3 Draw this distribution and decide how strange
your data are using a p value or critical region

Our data gave 5 65.4 Is this a strange result to get from

the distribution below
X when
We need way to
a measurethe Ho is tou
strangeness of data How about

PIX 65.41 Ho is true

I
Not a good idea ble O

P continuous RV a constant 0
Let's encode strangeness via p value

Def P value is the probability of observing your data

or something more extreme relative to Hi assuming
Ho is true It
Observed 5 65.4
I density Ho M 65 us Hill 65
So what ismoreextpme

p value 5865.4
I p value
tt
pfyg65 tlptrue
make it NCoill
INN 65 to
P Iif 65
5 tip 231.78897 0.0368
Step 4 Make a choice between Ho and Hi and express
this carefully before data collection
f
We compare the p value against some
x
pre
determined cutoff
known as the significance level or level of significance

reject Ho in favor of H I if p values a

We say
fail to reject Ho if p value a

If 2 0.05 then wereject Ho in favor of H at a

level of significance ble p value 0.0368 0.05 L
and we say the difference between and
Mo 65 is statistically significant Xf5.4our observed statistic
Tour original belief Ho
Remark This process testing
hypothesis does not
prove anything about Ho or Hi
Step 3 alternative find a region for our where
we always reject Ho Esytistic
Def Any function of the observed data whose numerical value
dictates whether Ho is rejected or not is called a

test statistic TX E.g TIX I

pdf
Critical Rejection Region R set of values
for TIX that result in Ho being rejected
Critical value c the points separating
R from acceptance region I 11111 Hml
acceptance I C T
region rejection
How to find c Set c s t P TIX ER a region
 Z No l
X pdf

want area area a

L

t I

i É
Hi M 65 reject for large I
Find est PIX e I Hol a PI 531 7 2

Thus we reject Ho if Plz c a

Z Za
C za
I
X 65 I
GEEK
Za
in
 observed values of Xis xnÉdN no

Himeno Hi MIM
Z N oil Z N oil

area
412 I N ELL
Reject keep It
Heal 1 a Reject Keep I
th
I y p
Za 2212 7212
two sided test
Calculating p values X Xn it NCM o o known
Mill
X Mo Hot
Test statistic Z oh N o Il a RV

Observed test statistic

I
Z EYE a constant
Z score

Hi M no p value PLZ z

IV Constant
Hi M Mo p value PLZ E Z

Hi u no p value RIZ 121 R Ze 121

absolute
by symmetry 2P Z Iz 1
value for
217 Z E 721 two sided
Hi
 7.2 Testing M with o unknown

Recall If Xi Xn aid Na 04 then

test
Thy In of freedom
If
statistic i degree
t score
sample standard deviation

To test Ho Melo Us Hi M I Mo with o unknown

first compute the observed test statistic

I Mo constant
t
S Jn

Option 1 If It taking reject Ho else keep Ho

Option 2 If p value 2P Tn It 1 ex
reject Ho
else keep Ho
Test
stat I observed

IR V I test stat constant

Option 1

Option 2 Test stat Tn ITT observed t

7
Hi M Mo p value P Tn i t

Hi nano p value P Tn l et

Hi u Mo p value P Thy 3141 P Tn E Kl

2P Tn i 14
by symmetry
2p Tn ie Itt
 Feat
Sol Let u true mean weight of meat when beginning
the conversation w

We want to test O
Ho n 4 us Hi
NE 4

The observed test statistic is

A Mo 4.3 4
t 5 5
0.4 58 2.11
If not specified always assume 2 0.05
Option 1 We reject Ho if t taint
to 05 1.8946
 Since t 2.121 7 1.8946 to 0517
we reject Ho in favor of H

Option 2 p value P Tn i s t

P Ty 32.121
q
can't find it using t table
but we can bound it 11 0 05
0025
t table R T 1.8946 0.05 171
Ty
P T 2.3646 0.025

Since 1.8946
We have that
t 2.3646
0.0252 p value 0.05 L
Ziggy
2 121
we reject Ho in four of H at the
2 0.05 level of significance