Hypothesis Testing
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Hypothesis testing 1. State null hypothesis and alternate hypothesis 2. Select level of significance, ἀ, the probability of rejecting null hypothesis when it is true 3. Select the test statistic – a value determined from sample information, used to determine whether to reject the null hypothesis. i.e. z. 4. Decision rule – critical value a. The dividing point between the region where the null hypothesis is rejected and where it is not rejected. 5. Make a decision a. Compute test statistic, compare it to critical value, reject/not reject null hypothesis b. If z = x−μ ơ √n < -Z α , reject H 0 P-value: - Probability of observing a sample value as extreme as, or more extreme than, the value observed, given that the null hypothesis is true. o P-value smaller than significance level, H0 rejected (the smaller, the more likely H0 is false) o P-value larger than significance level, H0 not rejected. (the larger, the likelier H0is true) o P-value is the region less than / more than critical value. (rejection region/tail), and depends on whether it’s one or two tailed.
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Hypothesis Testing
Transcript of Hypothesis Testing
Hypothesis testing1. State null hypothesis and alternate hypothesis2. Select level of significance, , the probability of rejecting null hypothesis when it is true3. Select the test statistic a value determined from sample information, used to determine whether to reject the null hypothesis. i.e. z. 4. Decision rule critical valuea. The dividing point between the region where the null hypothesis is rejected and where it is not rejected.5. Make a decisiona. Compute test statistic, compare it to critical value, reject/not reject null hypothesis b. If z = < -Z , reject H0P-value: Probability of observing a sample value as extreme as, or more extreme than, the value observed, given that the null hypothesis is true. P-value smaller than significance level, H0 rejected (the smaller, the more likely H0 is false) P-value larger than significance level, H0 not rejected. (the larger, the likelier H0is true) P-value is the region less than / more than critical value. (rejection region/tail), and depends on whether its one or two tailed.
