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solved ques on t-test, chi square and mann whitney

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T statistics

Students Pocket money(Rs.) Problem definition: we have

1 2500 chosen to approximate the

2 1500 pocket money of 15 students

3 1700 of our college because this

4 1000 was the most suitable

5 1500 measurement of t statistics

6 600 and was the most reliable

7 800 data that could be collected

8 700 from the college

9 2000 We have surveyed 15 people

10 800 about the pocket money they

11 1500 get. The average of it was

12 2500 1000. Use a 5% level of

13 2000 significance to determine if

14 4000 the average is more than

15 3500 what is quoted.

Scale of Data – ratio

Sampling – convenient

α- .05(because the sources of the collected data is reliable, so we did not assume a higher

level of error rate)

Justification for tool used –because the sample size is less than 30 so we use the t statistics

STEP 1: H0 : µ = 1000 (average of pocket money of 15 people is 1000)

Ha : µ>1000(average of pocket money is greater than 1000)

STEP 2 : The appropriate statistical test is

t = [ - µ]/(s/√ n)

STEP 3: α- .05

STEP 4: df = n-1

= 15 – 1

= 14.

One tail test

tc = t.05,14 = 1.761

decision is to reject the null hypothesis if the observed t statistics is greater than 1.761.

Step 5: data is as follows:

Sample standard deviation is calculated as follows:

x- x(bar)

1 2500

2500 528049.29

2 1500

1500 74709.29

3 1700 1700 5377.29

4 1000 1000 598039.29

5 1500 1500 74709.29

6 600 600 1376703.29

7 800 800 947371.29

800 947371.29

10 800

1500 74709.29

11 1500

2500 528049.29

12 2500

2000 51379.29

13 2000 4000 4958059.29

14 4000 3500 2981389.29

15 3500 ϵX = 26600 total= 14349333.96

n= 15

= 26600/15

= 1773.33

s= √ [(x- x(bar))^2/n-1]

= √ (14349333.96/14)

= 1012.399

STEP 6: t = x(bar)- µ/ (s/√n)

= 1773.33 – 1000)/(1012.399/√15)

= 773.33/261.400

= 2.96

STEP 7: tobserved > tcricitcal

2.96>1.761

Hence, null hypothesis is rejected.

STEP 8: Business Implication: from the data gathered we could conclude

that the average pocket money of students of our college is greater than

1000.

Chi square proportion

A total of 45 people are surveyed and asked if they are affected by

recession. We expect that the 60% of population says that recession has

affected them. We wish to disprove the outcome and say that more than

60% favor this. Out of 45 people, 32 said that recession has affected

them.

Problem definition In this time of recession, we would like to know

about the number of people who are affected by recession. Only 60% said

that they are affected by recession. We took a sample of 45 people from

our college, out of which 32 said that recession had affected them.

Because the number of classifications is 2 so we will use chi square

proportion

Scale of Data – Nominal

Sampling – convenient Sampling

α= .05

Justification for tool used –out of a total of 45 only 32 answered

according to our expectations so we need to apply the population

proportion using CHI SQUARE GOODNESSOFFIT TEST.

STEP 1: H0: p= .60 (population proportion is 60%)

Ha: p> .60 (population proportion is more than 60%)

χ= [ϵ (f0fe) ^2]/fe

fo fe

STEP 3: α= .05

Recession 32 27

affected

STEP 4: k1

Recession not 13 18

21= 1 affected

χ ^ 2c = χ^2 .05,1 = 3.841

STEP 5: Data already gathered.

STEP 6: X^2 = [ϵ(fofe)^2]/fe

= [ (3227)^2/27] + [ (1318)^2/18]

= 2.315

Hence hypothesis fail to reject.

STEP 8 : Business Implication: by the data gathered we could conclude that more than

60% people in our college are affected by recession, so we would also like to know the

further affects of recession and would also like to know the cure of the same

Mann-Whitney U test(large)

Do the Vodafone users have less monthly spending Reliance(R) Vodafone(VF)

on their mobiles as compared to reliance users? To

50 150

test this we have selected 2 groups of people: one

who use Vodafone and other who uses reliance. Use 100 130

the data and determine whether Vodafone users spend 111 250

less on their mobiles than reliance customers. α= .05

121 222

in knowing the reason of falling of our sales as

450 345

compared to that of vodafone (VF)customers. We

would also be interested in knowing that why are the 600 650

on reliance?

333 850

Scale- ratio which is later converted to ordinal on

333 222

ranking

Sampling – convenient 123

α= .05

Justification for tool used – because the population is large (greater than 10) and the two

samples are independent of each other, so we are using the MANN – WHITNEY U TEST

(LARGE)

Step1: H0:monthly expenditure of both groups, on mobile, is equal.

Ha: monthly expenditure of both groups, on mobile, is not equal.

Step 2: large sample Mann-Whitney U test is appropriate.

Step 3: alpha=0.05

Step 4:if the p value of sample statistics is < 0.05, decision is to

reject the null hypothesis

value Rank group value Rank group

50 1 R 333 12.5 R

121 4 R 350 16 R

123 5 VF 450 17 R

130 6 VF 500 18 R

150 7 VF 551 19 VF

250 10 VF 700 22 VF

300 11 R 850 23 VF

333 12.5 R

Step 5:Solving for U, µu, σu

U = n1*n2+ n1 (n1+1)/2 – w1

=81

µu = (n1*n2)/2

= (11*12)/2

= 66

σu= √[ n1*n2(n1+n2+1)/12]

= 16.24

Step6: : Observed z value is:

z= (U- µu)/ σu

= (81-66)/16.24

= .9236

Step 7: p value associated is 0.3212.

FINAL P VALUE = 0.5-0.3212

=0.1788

0.1788>0.05, hence the null hypothesis is accepted.

Step8:the monthly expenditure of both the groups is not equal, hence we need to

find out the shortcomings in the company’s policies, procedure, tarrif vouchers

offered, talk time provided. Because people are spending less on our company this

will thereby reduce the customer base of company, so we need to keep in pace

with the offers given by our competitors as well.

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