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ANALYSIS OF VARIANCE

Vikas
170101060011
Mba IB
Contents
 Introduction
 Meaning
 Assumptions
 One way ANOVA
 Two way ANOVA
 Techniques
 Steps
 References
Introduction
 The analysis of variance frequently referred
to by the contraction ANOVA

 The analysis of variance technique,


developed by R.A. Fisher in 1920’s
 ANOVA is comparison of means. Each
possible value of a factor or combination of
factor is treatment.

 The ANOVA is a Powerful and common


statistical procedure in the social science.
ASSUMPTIONS
Normality

Homogeneity

Independence
of error
NORMALITY

 The data are quantitative in nature and are


normally distributed. In case of nominal or
ordinal data where results are given in
percentages or ranks.
HOMOGENEITY
 The second assumptions is Homogeneity of
variance which means that the variances of the
population from which samples have been
drawn are equal.
Independence of Error
 The Third assumptions is that the
samples are drawn from the population
randomly and independently. In case
this assumption does not hold,
inferences drawn from ANOVA will not
be valid.
Technique of analysis of variance
Steps
 State null & alternative hypothesis
 State Alpha
 Calculate degrees of Freedom
 State decision rule
 Calculate test statistic
- Calculate variance between samples
- calculate variance within the samples
 Calculate F statistic
Analysis of variance in Two- way
Classification
 In a one factor analysis of variance explained above the
treatments constitute different levels of a single factor
which is controlled in the experiment. When it is
believed that two independent factors might have an
effect on the response variable of interest.
REFERENCE

 Business Statistics (Dr. S.P. Gupta)


 Business statistics (GC Berry)
 https://statistics.laerd.com
Thank You