Hypothesis Testing

Part A
Hypothesis
A statistical hypothesis is an assumption

about a population parameter.
Hypothesis Testing
A decision making process for evaluating
claims about a population.
In statistical hypothesis testing, there are
always two hypotheses
1. Null Hypothesis
2. Alternate Hypothesis
Null Hypothesis
The null hypothesis, symbolized by H0, is a
statistical hypothesis that states that there is
no difference between a population parameter
and sample statistic.
The null hypothesis states that there is no
difference between a population mean and a
sample mean.
The hypothesis to be tested is called the null
hypothesis
Cont..
Null hypothesis contains a statement of
equality such as =, ≤ or ≥
Alternate Hypothesis
The alternative hypothesis, symbolized by H1,
is a statistical hypothesis that states the
existence of a difference between a population
parameter and sample statistic.
The null hypothesis states that there is a
difference between a population mean and a
sample mean.
We test the null hypothesis against an
alternative hypothesis.
Cont..
Alternate hypothesis contains a statement of
inequality such as ≠, > or <
when a researcher conducts a study, he or
she is generally looking for evidence to
support a claim. Therefore, the claim should
be stated as the alternative hypothesis.
Steps in a Hypothesis Test
1. Write the null and alternate hypothesis.
Cont..
2. State the level of significance.
This is the maximum probability of rejecting
the null hypothesis when it is actually true.
i.e., (Type 1 error)
Denoted by α
The most frequently used levels of
significance are 0.10, 0.05 and 0.01
 For example, a significance level of 0.05
indicates a 5% risk of concluding that a
difference exists when there is no actual
difference.
Cont..
3. Find the test Statistics.
A test statistic is used to determine the
position of the statistic based on our sample
assuming that the null hypothesis is true.
Test statistic is performed to calculate the Z-
score
Cont..
4. Determine the critical region using the Z-
table.
Critical region also called rejection region.
When the calculated test statistics falls in the
rejection region, we reject the null hypothesis
in favour of the alternate hypothesis.
Cont..
5. Make a Decision
Exercise
The average score of all sixth graders in
school District A on a math aptitude exam is
75 with a standard deviation of 8.1. A random
sample of 100 students in one school was
taken. The mean score of these 100 students
was 71. Does this indicate that the students
of this school are significantly less skilled in
their mathematical abilities than the average
student in the district? (Use a 5% level of
significance.)
Thank you