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Attribution Non-Commercial (BY-NC)

Als DOCX, PDF, TXT **herunterladen** oder online auf Scribd lesen

- Neuromancer
- The E-Myth Revisited: Why Most Small Businesses Don't Work and
- How Not to Be Wrong: The Power of Mathematical Thinking
- Drive: The Surprising Truth About What Motivates Us
- Chaos: Making a New Science
- The Joy of x: A Guided Tour of Math, from One to Infinity
- How to Read a Person Like a Book
- Moonwalking with Einstein: The Art and Science of Remembering Everything
- The Wright Brothers
- The Other Einstein: A Novel
- The 6th Extinction
- The Housekeeper and the Professor: A Novel
- The Power of Discipline: 7 Ways it Can Change Your Life
- The 10X Rule: The Only Difference Between Success and Failure
- A Short History of Nearly Everything
- The Kiss Quotient: A Novel
- The End of Average: How We Succeed in a World That Values Sameness
- Made to Stick: Why Some Ideas Survive and Others Die
- Algorithms to Live By: The Computer Science of Human Decisions
- The Universe in a Nutshell

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INFERENTIAL STATISTICS

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

INFERENTIAL STATISTICS

1. Lesson Objectives

After studying this session you would be able to

1. Understand and infer results from data in order to answer the associational and

differential research questions using different parametric and non parametric tests.

2. Understand, implement and interpret the chi-square, phi and cramers V

3. understand, implement and interpret the correlation statistics

4. understand, implement and interpret the regression statistics

5. understand, implement and interpret the T-test statistics

Lesson Outline

1. Non parametric test.

1. Chi square /Fisher exact

2. Phi and cramers v

3. Kendall tau-b

4. Eta

2. Parametric test

1. Correlation

1. Pearson correlation

2. Spearman correlation

2. Regression

1. Simple regression

2. Multiple regression

3. T-Test

1. One-sample T-test

2. Independent sample T-test

3. Paired sample T-test

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INFERENTIAL STATISTICS

Inferential statistics are used to make inferences (conclusions) about a population from a

sample based on the statistical relationships or differences between two or more variables using

statistical tests with the assumption that sampling is random in order to generalize or make

predictions about the future.

Why we use inferential Statistics:-

Inferential statistics are used

1. To test some hypothesis either to check relationship between variables (two/more) or to

compare two groups to measure the differences among them.

2. To generalize the results about a population from a sample

3. To make predictions about the future.

4. To make conclusions

You don't need to understand the underlying calculus, but you do need to know which inferential

statistic is appropriate to use and how to interpret it.

Some basic concepts about inferential statistics

1. Statistical significance (The p value)

Statistical significance test is the test of a null hypothesis H

o

which is a hypothesis that we attempt to

reject or nullify. i.e.

H

o

=There is no relationship /Difference between variable 1 and variable 2

When we apply any inferential statistic, it gives us significance value (called p value). If the p value is

less than 5% then the test result is said to be significant at the 5% level. The term significant means

that the test signifies or points to the conclusion that there is evidence against the truth of the null

hypothesis. The comparison of p with 5% is a standard method often used by researchers, but it is

better to report and interpret the actual values of p.

Interpretation

If the p value is greater than 0.05 than it means that H

o

is accepted and H

1

is rejected. It relates that

there is no relationship/difference between the variables/groups.

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If the p value is less than or equal to 0.05 than it means that H

o

is rejected and H

1

is accepted. It

relates that there is relationship/difference between the variables/groups. A higher p value means

that the relationship is lesser significant and a smaller p value means that the relationship is highly

significant.

2. Confidence Interval

Confidence interval is a range of values constructed for a variable of interest so that this

range has a specified probability of including the true value of the variable. The specified

probability is called the confidence level, and the end points of the confidence interval are

called the confidence limits.

It is one of the alternatives to null hypothesis significance testing (NHST). These intervals

provide more information then NHST and may provide more practical information. For

example, suppose one knew that an increase in reading scores of five points, obtained on a

particular instrument, would lead to a functional increase in reading performance.

Two different methods of instruction were compared. The result showed that students who used

this new method scored significantly higher statistically than those who used the other method.

According to NHST, we would reject the null hypothesis of no difference between methods and

conclude that the new method is better. If we apply confidence intervals to this same study, we can

determine an interval that contains the population mean difference 95% of the time. If the lower

bound of that interval is greater than five points, we can conclude that using this method of

instruction would lead to a practical or functional increase in reading levels. If, however, the

confidence interval ranged from say 1 to 11, the result would be statistically significant, but the

mean difference in the population could be as little as 1 point, or as big as 11 points. Given these

results, we could not be confident that there would be a practical increase in reading using the new

method.

3. The effect size (weak, moderate or strong)

Effect size is the strength of the relationship between the independent variable and the dependent

variable, and/or the magnitude of the difference between levels of the independent variable with

respect to the dependent variable.

A statistically significant outcome does not give information about the strength or size of the

outcome. Therefore, it is important to know, the size of the effect. Statisticians have proposed many

effect size measures that fall mainly into two types of families, the r family and the d family.

Interpreting Effect Sizes

Effect sizes always have an absolute value between -1.0 and +1.0. According to Cohen (1988) we can

interpret the effect size (r/d) as follows

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0 No effect No relationship

>0 0.33 Small effect Weak relationship

>0.33 0.70 Medium/typical effect Moderate

relationship

>0.70 <1 Large effect Strong relationship

1 Maximum effect Perfect relationship

Steps in interpreting inferential statistics

1. Relate why a test is applied

2. Discuss for which variable the test is applied

3. Elaborate whether the null hypothesis is rejected or accepted w.r.t. p value

As discussed above if the significance (p) value is less than 0.05 then H

O

is rejected and H

1

is

accepted, conversely if the significance value is greater than 0.05 then H

O

is accepted and H

1

is

rejected

4. State what is the direction of the effect

5. For associational research question indicate whether the association or relationship is

positive or negative

6. For differential research question state which group performed better?

7. Conclude the results

Types of tests used in Inferential Statistics

Inferential statistics include a wide variety of tests to infer the results. This variety of tests can be

classified in two broader categories that are

1. Non parametric tests

2. Parametric tests

Following is the detailed discussion related to both types of tests.

1. Non parametric test

Non parametric tests are the statistical tests that are used

1. When the level of measurement is nominal or ordinal. E.g. chi-square test or Kendalls tau-b.

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2. When assumptions about normal distribution in the population is not met e.g. spearman

correlation

Non parametric tests involve

1. Chi-Square test

2. Kend

3. alls tau-b

4. Eta

5. Spearman correlation (will be discussed in correlation section)

Lets see these tests in detail.

Chi-Squared Test

Chi-Squared test is the most commonly used non-parametric test to check the association

between two nominal variables in order to accept or reject the null hypothesis.

Hypothesis for Chi-Square Test

H

o

= there is no association between gender and geometry in h.s.

H

1

= There is association between gender and geometry in h.s.

It is used to check

1. The association between two nominal variables

2. Compare two or more groups if they are categorical in nature

Assumptions and Conditions for the Chi-Squared test

1. The data of the variables must be independent. Each subject is assessed only once.

2. Both the variables are nominal.

3. All the expected counts are greater than 1 for chi-square.

4. At least 80% of the expected frequencies should be greater than or equal to 5.

Checking the assumptions for the Chi-Squared test

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The assumptions for Chi-squared test are checked through cross tabulation of the

categorical variables. It can be drawn by

1. Click the analyze menu

2. Select the descriptive statistics option

3. Select crosstabs option in the sub menu

4. Put geometry in h.s. in rows section and gender in columns section

5. Check chi-squared, phi and Cramers v from statistics tab

6. Check observed, expected and total from cells tab

7. Click continue then ok to get the following crosstabs in output window

geometry in h.s. * gender Crosstabulation

gender

Total

male female

geometry in h.s. not taken Count 10 29 39

Expected Count 17.7 21.3 39.0

% of Total 13.3% 38.7% 52.0%

Taken Count 24 12 36

Expected Count 16.3 19.7 36.0

% of Total 32.0% 16.0% 48.0%

Total Count 34 41 75

Expected Count 34.0 41.0 75.0

% of Total 45.3% 54.7% 100.0%

1. Check if all the values of expected counts are greater than one (excluding total column and

the total row)

2. Check if the 80% values of expected counts are greater than 5. You can calculate the

percentage using following formula

Number of cells with expected counts greater than 5 100

Total number of cells

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3. If the assumptions are fulfilled then use significance value of Pearson chi-square as

highlighted below

4. If the assumptions for chi-square are not fulfilled then select the significance value of

Fishers exact test

5. To check the strength of the relationship (effect size) use the value of Phi for 2x2 crosstab

and value of Cramers V for 3x3 crosstab. Remember that both Phi and Cramers v have

similar values for 2x3 and 3x2 crosstabs

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

geometry in h.s. * gender

75 100.0% 0 .0% 75 100.0%

Chi-Square Tests

Value df

Asymp. Sig. (2-

sided)

Exact Sig. (2-

sided)

Exact Sig. (1-

sided)

Pearson Chi-Square 12.714

a

1 .000

Continuity Correction

b

11.112 1 .001

Likelihood Ratio 13.086 1 .000

Fisher's Exact Test

.000 .000

Linear-by-Linear Association 12.544 1 .000

N of Valid Cases

b

75

a. 0 cells (.0%) have expected count less than 5. The minimum expected count is 16.32.

b. Computed only for a 2x2 table

Symmetric Measures

Value Approx. Sig.

Nominal by Nominal Phi -.412 .000

Cramer's V .412 .000

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Interpretation:

To check the association between gender and geometry in h.s. chi-square test is conducted. The

case processing summary table indicates that there is no participant with missing value. The

assumptions are checked through crosstabs. The Crosstabulation table includes the Counts and

Expected Counts, and their relative percentages within gender. The result shows that there are

24 males who had taken geometry which is 71% of total 34 male students. On the other hand,

12 of 41 females took geometry; that is only 29% of the females. It looks like a higher

percentage of males took geometry than female students. The Ch-Square Test table tell us

whether we can be confident that this apparent difference is not due to chance.

Note: it is noted very carefully that, we use the Pearson Chi-Square or (for small samples) the

Fishers exact test to interpret the results of the test.

Note, in the Cross Tabulation table, that the Expected Count of the number of male students

who didnt take geometry is 17.7 and the observed or actual Count is 10. Thus, there are 7.7

fewer males who didnt take geometry than would be expected by chance, given the Totals

shown in the Table. There are also the same discrepancies between observed and expected

counts in the other three cells of the table. A question answered by the chi-square test is

whether these discrepancies between observed and expected counts are bigger than one might

expect by chance.

The Chi-Square Tests table is used to determine if there is a statistically significant relationship

between two dichotomous or nominal variables. It tells you whether the relationship is

statistically significant but does not indicate the strength of the relationship, like phi or a

correlation does. In output, we use the Pearson Chi-Square or (for small samples) the Fishers

exact test to interpret the results of the test. They are statistically significant (p < .001), which

indicates that we can be quite certain that males and females are different on whether they

take geometry.

Phi is -.412, and like the chi-square, it is statistically significant. Phi is also a measure of effect

size for an associational statistic and, in this case, effect size is moderate according to Cohen

(1988)

KENDALLS TAU-B

If the variables are ordered (i.e. ordinal), you have several other choices. We will use Kendalls

tau-b in this problem.

Example:

What is the relationship or association between fathers education and mothers education?

1. Analyze Descriptive Statistics Crosstabs.

N of Valid Cases 75

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2. Click on Reset to clear the previous entries.

3. Put mothers education revised in the Rows box and fathers education revised in the

columns box.

4. Click on Cells and ask that the Observed and Expected cell counts and Total percentages

be printed in the table. Click on Continue and then Statistics.

5. Request the following Statistics: Kendalls tau-b coefficient under ordinal, and Phi and

Cramers V under nominal (for comparison purposes). Do not check Chi-Square.

6. Click on Continue

7. Click on OK.

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

mother education

revised * father

education revised

73 97.3% 2 2.7% 75 100.0%

mother education revised * father education revised Crosstabulation

father education revised

Total

1 2 3

mother education

revised

1 Count 43 8 2 53

Expected Count 35.6 13.1 4.4 53.0

% of Total 58.9% 11.0% 2.7% 72.6%

2 Count 6 10 2 18

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Expected Count 12.1 4.4 1.5 18.0

% of Total 8.2% 13.7% 2.7% 24.7%

3 Count 0 0 2 2

Expected Count 1.3 .5 .2 2.0

% of Total .0% .0% 2.7% 2.7%

Total Count 49 18 6 73

Expected Count 49.0 18.0 6.0 73.0

% of Total 67.1% 24.7% 8.2% 100.0%

Symmetric Measures

Value

Asymp.

Std. Error

a

Approx.

T

b

Approx.

Sig.

Ordinal by Ordinal Kendall's tau-b

.494 .108 3.846 .000

N of Valid Cases 73

a. Not assuming the null hypothesis.

b. Using the asymptotic standard error assuming the null hypothesis.

Interpretation:

To investigate the relationship between fathers education and mothers education, Kendalls

tau-b was used. The analysis indicated a significant positive association between fathers

education and mothers education, tau =.494, p<.001. This means that more highly educated

fathers were married to more highly educated mothers and less educated fathers were married

to less educated mothers. This tau is considered to be a large effect size (Cohen, 1988).

ETA

If one variable is nominal and the other is scale then ETA is the appropriate test used to check

the relationship between the two variables. Eta is calculated for both variables. First you should

decide the dependent variable and consider the Eta value of that variable.

Example: What is the association between gender and number of math courses taken? How

strong is it?

8. Analyze Descriptive Statistics Crosstabs.

9. Click on Reset to clear the previous entries.

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10. Put math courses taken in the Rows box and gender in the columns box.

11. Click the Statistics and select Eta.

12. Click Continue

13. Click OK to get following results

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

math courses taken *

gender

75 100.0% 0 .0% 75 100.0%

math courses taken * gender Crosstabulation

Gender

Total

Male female

math courses

taken

0 Count 4 12 16

Expected Count 7.3 8.7 16.0

1 Count 3 13 16

Expected Count 7.3 8.7 16.0

2 Count 9 6 15

Expected Count 6.8 8.2 15.0

3 Count 6 2 8

Expected Count 3.6 4.4 8.0

4 Count 7 5 12

Expected Count 5.4 6.6 12.0

5 Count 5 3 8

Expected Count 3.6 4.4 8.0

Total Count 34 41 75

Expected Count 34.0 41.0 75.0

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Directional Measures

Value

Nominal by

Interval

Eta math courses taken

Dependent

.328

gender Dependent .419

Interpretation

Eta was used to investigate the strength of the association between gender and number of

math courses taken (eta=.33). This is a weak to medium effect size (Cohen, 1988). Males were

more likely to take several or all the math courses than females.

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Class Activity Session 6

Pleuse show ull work und expluln your unswers.

1. Popcorn sules ln movle theuters breuk down us 40% pluln popcorn und 60% buttered

popcorn. Whlle 65% of the pluln popcorn ls purchused by udults, 80% of the

buttered popcorn ls purchused by chlldren. If u chlld purchuses popcorn, whut ls the

probublllty thut lt ls buttered popcorn?

(guldellnes: develop u |olnt-probublllty tuble. Note thut the problem ls usklng thut you

compute u condltlonul probublllty)

2. A process follows the blnomlul dlstrlbutlon wlth n = 7 und p = .4. Flnd

u. P(x = 3)

b. P(x > 5)

c. P(x e 2)

1. 6cores on un endurunce test for curdluc putlents ure normully dlstrlbuted wlth meun =

200 und stundurd devlutlon = 30.

u. Whut ls the probublllty u putlent wlll score ubove 206?

b. Whut percentuge of putlents score below 155?

c. Whut score does u putlent ut the 25th percentlle recelve?

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2. A culculus lnstructor uses computer ulded lnstructlon und ullows students to tuke the

mldterm exum us muny tlmes us needed untll u pusslng grude ls obtulned. Followlng

ls u record of the number of students ln u cluss of 20 who took the test euch number

of tlmes.

6tudents Number of tests

7 1

6 2

4 3

2 4

1 5

u. use the relutlve frequency upprouch to construct u probublllty dlstrlbutlon

b. show thut lt sutlsfles the requlred condltlon for belng u probublllty dlstrlbutlon.

c. Flnd the expected vulue of the number of tests tuken.

5. For the puyoff tuble below, the declslon muker wlll use P(s

1

) = .15, P(s

2

) = .5, und P(s

3

) = .35.

s

1

s

2

s

3

d

1

-5000 1000 10,000

d

2

-15,000 -2000 40,000

u. Whut ulternutlve would be chosen uccordlng to expected vulue?

b. For u lottery huvlng u puyoff of 40,000 wlth probublllty p und -15,000 wlth probublllty

(1-p), the declslon muker expressed the followlng lndlfference probubllltles.

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Puyoff Probublllty

10,000 .85

1000 .60

-2000 .53

-5000 .50

Let U(40,000) = 10 und U(-15,000) = 0 und flnd the utlllty vulue for euch puyoff.

c. Whut ulternutlve would be chosen uccordlng to expected utlllty?

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CORRELATION & REGRESSION

Inferential Statistics

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Correlation

Correlation is a statistical process that determines the mutual (reciprocal) relationship between two (or

more) variables which are thought to be mutually related in a way that systematic changes in the value

of one variable are accompanied by systematic changes in the other and vice versa.

It is used to determine

1. The existence of mutual relationship that is defined by the significance (p) value.

2. The direction of relationship that is defined by the sign (+,-) of the test value

3. The strength of relationship that is defined by the test value

Correlation Coefficient (r)

The correlation coefficient measures the strength of linear relationship between two or more

numerical variables. The value of correlation coefficient can vary from -1.0 (a perfect negative

correlation or association) through 0.0 (no correlation) to +1.0 (a perfect positive correlation).

Note that +1 and -1 are equally high or strong, but they lead to different interpretations. A high

positive correlation between anxiety and grades would mean that students with higher anxiety

tended to have higher grades, those with lower anxiety had lower grades, and those in between

had grades that were neither especially high nor especially low. A high negative correlation

would mean that students with high anxiety tended to have low grades; also high grades would

be associated with low anxiety. With a zero correlation there are no consistent associations. A

student with high anxiety might have low, high or medium grades.

There are two types of correlation

1. Pearson Correlation

2. Spearman Correlation

1. Pearson Correlation

The Pearson Correlation is used when you have two variables that are normal/scale An

assumption of the Pearson correlation is that the variables are related in a linear (straight

line) way so we will examine the scatter plots to see if that assumption is reasonable.

Second, the Pearson Correlation, and the Spearman correlation will be computed. and the

Spearman is used when one or both is ordinal.

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1. Assumptions and conditions for Pearson

1. The two variables have a linear relationship.

2. Scores on one variable are normally distributed for each value of the other variable and

vice versa.

3. Outliers (i.e. extreme scores) can have a big effect on the correlation.

1. Checking the assumptions for Pearson Correlation

The assumptions for correlation test are checked through normal curve (normality

assumption) and the scatter plot (linearity assumption)

Normality assumption

1. Click on the analyze menu

2. Select the descriptive statistics option

3. Select frequency option in the sub menu

4. Put math achievement and Satmath in variables box

5. Check skewness in statistics tab and histogram in charts tab

6. Click continue and then ok

7. You will get skewness values showing that the variables are

approximately normally distributed further check the

normality of data through normal curve in histograms using

chart editor

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Statistics

math achievement test scholastic aptitude test - math

N Valid 75 75

Missing 0 0

Skewness .044 .128

Std. Error of Skewness .277 .277

Linearity assumption

8. Click on the graph menu

9. Select legacy dialogue, interactive and then scatter plot

10. Put math achievement in y-axis and satmath in x-axis

11. Click ok to get scatter plot in output window

12. Double click on the scatter plot to get into chart editor

13. Click on the add fit line at total button in tool bar to

get linear line and R square linear = 0.62 close window

14. Repeat the previous step for quadratic line and get R

square = 0.621

15. click apply and close the window

16. Calculate the difference between the two R square (0.621 0.62 = 0.001)

17. If the difference is less than 0.05 (the p value) then the relation is linear (0.001>0.05)

hence apply Pearson correlation

How to apply Pearson Correlation

1. Select analyze then correlate and then bivariate

2. Put math achievement and Satmath in variable box

3. Ensure that Pearson, two tailed, and flag relationships are

checked

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4. Click ok to get follow results in output window

Correlations

math

achievement test

scholastic

aptitude test -

math

math achievement test Pearson Correlation 1 .788

**

Sig. (2-tailed)

.000

N 75 75

scholastic aptitude test

math

Pearson Correlation .788

**

1

Sig. (2-tailed) .000

N 75 75

**. Correlation is significant at the 0.01 level (2-tailed).

Interpretation

To investigate if there was a statistically significant association between Scholastic aptitude test

and math achievement, a correlation was computed. Both the variables were approximately

normal there is linear relationship between them hence fulfilling the assumptions for Pearson's

correlation. Thus, the Pearsons r is calculated, r= 0.79, p < .001 relating that there is highly

significant relationship between the variables. The positive sign of the Pearson's test value

shows that there is positive relationship, which means that students who have high scores in

math achievement test do have high scores in scholastic aptitude test and vice versa. Using

Cohens (1988) guidelines the effect size is large relating that there is strong relationship

between math achievement and scholastic aptitude test.

Spearman Correlation:

If the assumptions for Pearson correlation are not fulfilled then consider the Spearman

correlation with the assumption that the Relationship between two variables is monotonically

non-linear

Example: what is the association between mothers education and math achievement?

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

1. Analyze Correlate Bivariate.

2. Move math achievement and mothers education to the variables box

3. Next ensure that the spearman and Pearson boxes are checked.

4. Make sure that the two-tailed (under test of significance), flag significant correlations

and two-tailed are checked

5. Now click on options and check means and standard deviations and click on exclude

cases list wise.

6. Click on continue and click on Ok

Correlations

a

mother's

education

math

achieveme

nt test

Spearman's

rho

mother's

education

Correlation

Coefficient

1.000 3.15

**

Sig. (2-tailed) . .006

math

achievement test

Correlation

Coefficient

.315

**

1.000

Sig. (2-tailed) .006 .

Interpretation

To investigate if there was a statistically significant association between mothers education and math

achievement, a correlation was computed. Mothers education was skewed (skewness=1.13), which

violated the assumption of normality. Thus, the spearman rho statistic was calculated, r, (73) = .32, p =

.006. The direction of the correlation was positive, which means that students who have highly educated

mothers tend to have higher math achievement test scores and vice versa. Using Cohens (1988)

guidelines the effect size is medium for studies in his area. The r

2

indicates that approximately 10% of

the variance in math achievement test score can be predicted from mothers education.

REGRESSION ANALYSIS

Regression analysis is used to measure the relationship between two or more variables. One

variable is called dependent (response, or outcome) variable and the other is called

Independent (explanatory or predictor) variables.

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It is used to check that due to one unit change in the independent variable(s) how much change

occurs in dependent variable.

Regression Equation

It is the equation representing the relation between selected values of one variable (x:the independent

variable) and observed values of the other (y: the dependent variable); it permits the prediction of the

most probable values of y. The standard form of this equation for two variables and for more than two

variables respectively is as follows

Y = a + bx Y = a + bx

1

+ cx

2

+ dx

3

+ ex

4

Y = dependent variable

a = Constant

b, c, d, e, = slope coefficients

x

1

, x

2

, x

3

, x

4

= Independent variables

Types of Regression

There are two types of regression analysis that are

7. Simple Regression

8. Multiple regression

9. Simple Regression

Simple regression is used to check the contribution of independent variable(s) in the dependent

variable if the independent variable is one.

10. Assumptions and conditions of simple regression

1. Dependent variable should be scale

2. The relationship of variables should be linear

3. Data should be independent

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Example: Can we predict math achievement from grades in high school

Commands

1. Analyze Regression Linear

2. Highlight math achievement. Click the arrow to move it into the dependent box

3. Highlight grades in high school and click on the arrow to move it into the independent

(s) box.

4. Click on Ok

Variables Entered/Removed

b

Model

Variables

Entered

Variables

Removed Method

1 grades in h.s.

a

. Enter

a. All requested variables entered.

Model Summary

Model R R Square

Adjusted R

Square

Std. Error of

the Estimate

1 .504

a

.254 .244 5.80018

a. Predictors: (Constant), grades in h.s.

ANOVA

b

Model

Sum of

Squares Df Mean Square F Sig.

1 Regression 836.606 1 836.606 24.868 .000

a

Residual 2455.875 73 33.642

Total 3292.481 74

a. Predictors: (Constant), grades in h.s.

b. Dependent Variable: math achievement test

Coefficients

a

Model

Unstandardized

Coefficients

Standardized

Coefficients

t Sig. B Std. Error Beta

1 (Constant) .397 2.530

.157 .876

grades in h.s. 2.142 .430 .504 4.987 .000

a. Dependent Variable: math achievement test

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Regression equation is Y = 0.40 + 2.14X

Interpretation

Simple regression was conducted to investigate how well grades in high school predict math

achievement scores. The results were statistically significant F (1, 73) = 24.87, p<.001. The

indentified equation to understand this relationship was math achievement = .40 + 2.14*

(grades in high school). The adjusted R

2

value was .244. This indicates that 24% of the variance

in math achievement was explained by the grades in high school. According to Cohen (1988),

this is a large effect.

Multiple Regression

Multiple regressions is used to check the contribution of independent variable(s) in the

dependent variable if the independent variables are more than one.

5. Assumptions and conditions of Multiple regression

1. Dependent variables should be scale.

Example: How well can you predict math achievement from a combination of four variables:

grades in high school, fathers education, mother education and gender

Commands

6. Analyze Regression Linear

7. Highlight math achievement. Click the arrow to move it into the dependent box

8. Highlight grades in high school, fathers education, mother education and gender and click

on the arrow to move them into the independent (s) box.

9. Under method, be sure that enter is selected.

10. Click on continue and then ok to get the following results in output window

Descriptive Statistics

Mean

Std.

Deviation N

math achievement

test

12.6621 6.49659 73

grades in h.s. 5.70 1.552 73

father's education 4.73 2.830 73

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

mother's education 4.14 2.263 73

Gender .55 .501 73

Model Summary

Model R R Square

Adjusted R

Square

Std. Error

of the

Estimate

1 .616

a

.379 .343 5.26585

ANOVA

b

Model

Sum of

Squares df

Mean

Square F Sig.

1 Regression 1153.222 4 288.305 10.397 .000

a

Residual 1885.583 68 27.729

Total 3038.804 72

Coefficients

Model

Unstandardized

Coefficients

Standardized

Coefficients

T Sig. B Std. Error Beta

1 (Constant) 1.047 2.526

.415 .680

grades in h.s. 1.946 .427 .465 4.560 .000

father's education .191 .313 .083 .610 .544

mother's education .406 .375 .141 1.084 .282

Gender -3.759 1.321 -.290 -2.846 .006

a. Dependent Variable: math achievement test

Regression Equation:

Y = 1.047 + 1.95X

1

+ 0.19X

2

+ 0.41X

3

3.76 X

4

Interpretation

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Simultaneously multiple regression was conducted to investigate the best predictors of math

achievement test scores. The means, standard deviation, and inter correlations can be found in

table. The combination of variables to predict math achievement from grades in high school,

fathers education, mothers education and gender was statistically significant, F = 10.40, p

<0.05. The beta coefficients are presented in last table. Note that high grades and male gender

significantly predict math achievement when all four variables are included. The adjusted R

2

value was 0.343. This indicates that 34 % of the variance in math achievement was explained by

the model according to Cohen (1988), this is a large effect.

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Class Activity Session 7

Correlation

Some studies are interested in whether two variables are related to each other.

Is there a relationship between birth order and IQ scores?

Is there a relationship between socioeconomic status (SES) and health?

The CORRELATION COEFFICIENT is a statistic that shows the strength of the relationship

between the two variables. The correlation coefficient falls between -1.00 and +1.00. The

statistic shows both the STRENGTH of the relationship between the variables, and the

DIRECTION of the relationship. The numerical value indicates the strength of the

relationship. The sign in front of the numerical value indicates the direction of the

relationship. Let us consider each of these in more detail.

THE NUMBERICAL VALUE:

Correlation coefficient values that are close to zero (e.g., -.13, +.08) suggest that there is no

relationship between the two variables. The closer the correlation is to one (e.g., -.97, +.83) the

stronger the relationship between the two variables. Thus, we might expect that there would

be no relationship between the height of college students and their SAT scores, and we would

be correct. The correlation coefficient is very close to zero. However, we might expect a

correlation between adult height and weight to be stronger, and again we would be correct.

THE SIGN:

The sign of the correlation coefficient tells us whether these two variable are directly related or

inversely related.

Do the two variables increase and decrease in the same direction?

The more time a student spends studying the better their grade, the less time spent studying

the lower the grade. Notice how both study time and grade vary in the same direction. As

studying increases grades increase, and when studying decreases grades decline. Grade and

study time would be POSITIVELY correlated. The term POSITIVE does not necessarily mean its a

good thing (when is getting a poor grade a "good" thing!). It simply means that there is a direct

relationship, the variables are varying (changing) in the same direction.

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Do the two variables vary in opposing directions?

As the number of children in a family increase the lower the IQ scores of the children. Thus,

family size and children's IQ scores vary in the opposite direction. As family size increases the

IQ scores decline, as the family size decreases IQ scores increase. IQ and family size are

NEGATIVELY correlated (inversely related).

Try the following exercise to see if you understand the concept of correlation.

It is best if you have read both this section and the research method section on correlational

studies before completing the exercise.

EXERCISE

Inferential Statistics

Inferential Statistics allow researchers to draw conclusions (inferences) from the data. There

are several types of inferential statistics. The choice of statistic depends on the nature of the

study. Covering the different procedures used is beyond the scope of this course. However,

understanding why they are used is important.

A researcher asks two groups of children to complete a personality test. The researcher then

wants to know whether the males scored differently than the females on certain measures of

personality. We will create a fictitious personality trait "Z." Here are the scores for the girls

and the boys:

Girls Boys

23 37 The mean score for the "Z" trait in boys

was higher than the mean score for "Z"

in the girls. But notice how within the

two groups there was considerable

fluctuation. By "chance" alone we might

have obtained these different

values. Thus, in order to conclude that

"Z" shows a gender difference, we need

40 56

37 18

41 41

41 42

33 38

28 50

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

25 22 to rule out that these differences were

just a fluke. This is where inferential

statistics come in to play.

24 33

13 47

28 25

44 46

Mean=31.42 Mean=37.92

SD=9.03 SD=11.14

An important concept in inferential statistics is STATISTICAL SIGNIFICANCE. When an inferential

statistic reveals a statistically significant result the differences between the groups were

unlikely due to chance. Thus, we can rule out chance with a certain degree of

confidence. When the results of the inferential statistic are not statistically significant, chance

could still be a reason why we obtained the observations that we did.

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

T-TEST STATISTIC

Inferential Statistics

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

T-TEST Statistics

The t test is used to compare to groups to answer the differential research questions. Its values

determines the difference by comparing means

Hypothesis for T-test

H

O

: there is no Difference between variable 1 and variable 2

H

1

: There is difference between variable 1 and variable 2

Types of T-test

There are three types of T-test

1. One sample t-test

2. Independent sample t-test

3. Paired sample t-test

1. ONE SAMPLE T-TEST

One sample t-test is used to determine if there is difference between population mean

(Test value) and the sample mean (X)

Assumptions and conditions of 1 sample t-test

1. The dependent variable should be normally distributed within the population

2. The data are independent.(scores of one participant are not depend on scores of the

other :participant are independent of one another )

Example: is the mean SAT-Math score in the modified HSB data set significantly different

from the presumed population mean of 500?

Commands

1. Analyze Compare means One sample t-test

2. Move scholastic aptitude test-math to the test variables box.

3. Type 500 in the test value box

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

4. Click on Ok

One-Sample Statistics

N Mean Std. Deviation

Std. Error

Mean

scholastic aptitude test

math

75 490.53 94.553 10.918

One-Sample Test

Test Value = 500

t Df

Sig. (2-

tailed)

Mean

Difference

95% Confidence Interval of

the Difference

Lower Upper

scholastic aptitude test math -.867 74 .389 -9.467 -31.22 12.29

Interpretation:

To investigate the difference between population and the sample, one-sample t-test is

conducted. The One-Sample Statistics table provides basic descriptive statistics for the variable

under consideration. The Mean AT-Math for the students in the sample will be compared to the

hypothesize population mean, displayed as the Test Value in the One-Sample Test table. On

the bottom line of this table are the t value, df, and the two-tailed sig. (p) value, which are

circled. Note that p=.389 so we can say that the sample mean (490.53) is not significantly

different from the population mean of 500. The table also provides the difference (-9.47)

between the sample and population mean and the 95% Confidence Interval. The difference

between the sample and the population mean is likely to be between +12.29 and -31.22 points.

Notice that this range includes the value of zero, so it is possible that there is no difference.

Thus, the difference is not statistically significant.

1. INDEPENDENT SAMPLE T-TEST

Independent sample T-test is used to compare two independent groups (Male and

Female)with respect to there effect on same dependent variable.

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Assumptions and conditions of Independent T-test

1. Variance of the dependent variable for two categories of the independent variable

should be equal to each other

2. Dependent variable should be scale

3. Data on dependent variable should be independent.

Example: Do male and female students differ significantly in regard to their average math

achievement scores

Commands

1. Analyze Compare means independent sample t-test

2. Move math achievement scores to the test variables box.

3. Move gender to the grouping variable box

4. Click on define groups

5. Type 0 for males in the group 1 box and 1 for females in the group 2 box

6. Click on continue

7. Click on Ok

Interpretation

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

The first table, Group Statistics, shows descriptive statistics for the two groups (males and

females) separately. Note that the means within each of the three pairs look somewhat

different. This might be due to chance, so we will check the t test in the next table.

The second table, Independent Sample Test, provides two statistical tests. The left two

columns of numbers are the Levenes test for the assumption that the variances of the two

groups are equal. This is not the t test; it only assesses an assumption! If this F test is not

significant (as in the case of math achievement and grades in high school), the assumption is

not violated, and one uses the Equal variances assumed line for the t test and related statistics.

However, if Levenes F is statistically significant (Sig. <.05), as is true for visualization, then

variances are significantly different and the assumption of equal variances is violated. In that

case, the Equal variances not assumed line used; and SSPS adjusts t, df, and Sig. The

appropriate lines are circled.

Thus, for visualization, the appropriate t=2.39, degree of freedom (df) = 57.15, p=.020. This t is

statistically significant so, based on examining the means, we can say that boys have higher

visualization scores than girls. We used visualization to provide an example where the

assumption of equal variances was violated (Levenes test was significant). Note that for grades

in high school, the t is not statistically significant (p=.369) so we conclude that there is no

evidence of a systematic difference between boys and girls on grades. On the other hand, math

achievement is statistically significant because p<.05; males have higher means.

The 95% Confidence Interval of the Difference is shown in the two right-hand column of the

output. The confidence interval tells us if we repeated the study 100 times, 95 of the times the

true (population) difference would fall within the confidence interval, which for math

achievement is between 1.05 points and 6.97 points. Note that if the Upper and Lower bounds

have the same sign (either + and + or and -), we know that the difference is statistically

significant because this means that the null finding of zero difference lies outside of the

confident interval. On the other hand, if zero lies between the upper or lower limits, there

could be no difference, as is the case of grades in h.s. The lower limit of the confidence interval

on math achievement tells us that the difference between males and females could be as small

as 1.05 points out 25, which are the maximum possible scores.

Effects size measures for t tests are not provided in the printout but can be estimated relatively

easily. For math achievement, the difference between the means (4.01) would be divided by

about 6.4, an estimate of the pooled (weighted average) standard deviation. Thus, d would be

approximately .60, which is, according to Cohen (1988), a medium to large sized effect.

Because you need means and standard deviations to compute the effect size, you should

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

include a table with means and standard deviations in your results section for a full

interpretation of t tests.

8. PAIRED SAMPLE T-TEST

Paired sample T-test is used to compare two paired groups (e.g. Mothers and fathers) with

respect to there effect on same dependent variable.

Assumptions and conditions of Paired sample T-test

9. The independent variable is dichotomous and its levels (or groups) are paired, or

matched, in some way (husband-wife, pre-post etc)

10. The dependent variable is normally distributed in the two conditions

Example: Do students fathers or mothers have more education?

Commands

11. Analyze Compare means paired sample t-test

12. Click on both of the variables, fathers education and mothers education, and move

them simultaneously to the paired variables box

13. Click on Ok

Paired Samples Statistics

Mean N

Std.

Deviation

Std. Error

Mean

Pair 1 father's education 4.73 73 2.830 .331

mother's

education

4.14 73 2.263 .265

Paired Samples Correlations

N Correlation Sig.

Pair 1 father's education &

mother's education

73 .681 .000

Interpretation

The first table shows the descriptive statistics used to compare mothers and fathers education

levels. The second table Paired Samples Correlations, provides correlations between the two

paired scores. The correlation (r=.68) between mothers and fathers education indicates that

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

highly educate men tend to marry highly educated women and vice versa. It doesnt tell you

whether men or women have more education. That is what t in the third table tells you.

The last table shows the Paired Samples t Test. The Sig. for the comparison of the average

education level of the students mothers and fathers was p=.019. Thus, the difference in

educational level is statistically significant, and we can tell from the means in the first table that

fathers have more education; however, the effect size is small (d=.28), which is computed by

dividing the mean of the paired differences (.59) by the standard deviation (2.1) of the paired

differences. Also, we can tell from the confidence interval that the difference in the means

could be as small as .10 of a point or as large as 1.08 points on the 2 to 10 scale.

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Class Activity Session 8

Inferential Statistics

Inferential Statistics allow researchers to draw conclusions (inferences) from the data. There

are several types of inferential statistics. The choice of statistic depends on the nature of the

study. Covering the different procedures used is beyond the scope of this course. However,

understanding why they are used is important.

A researcher asks two groups of children to complete a personality test. The researcher then

wants to know whether the males scored differently than the females on certain measures of

personality. We will create a fictitious personality trait "Z." Here are the scores for the girls

and the boys:

Girls Boys

23 37 The mean score for the "Z" trait in boys

was higher than the mean score for "Z"

in the girls. But notice how within the

two groups there was considerable

fluctuation. By "chance" alone we might

have obtained these different

values. Thus, in order to conclude that

"Z" shows a gender difference, we need

to rule out that these differences were

just a fluke. This is where inferential

statistics come in to play.

40 56

37 18

41 41

41 42

33 38

28 50

25 22

24 33

13 47

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

28 25

44 46

Mean=31.42 Mean=37.92

SD=9.03 SD=11.14

An important concept in inferential statistics is STATISTICAL SIGNIFICANCE. When an inferential

statistic reveals a statistically significant result the differences between the groups were

unlikely due to chance. Thus, we can rule out chance with a certain degree of

confidence. When the results of the inferential statistic are not statistically significant, chance

could still be a reason why we obtained the observations that we did.

In the example above we would use an inferential statistic called a T-TEST. The t-test is used

when we are comparing TWO groups. In this instance the t-test does not yield a statistically

significant difference. In other words, the differences between the scores for the boys and the

scores for the girls are not large enough for us to rule out chance as a possible explanation. We

would have to conclude then that there is no gender difference for our hypothetical "Z" trait.

Inferential statistics do not tell you whether your study is accurate or whether your findings are

important. Statistics cannot make up for an ill-conceived study or theory. They simply assess

whether we can rule out the first "extraneous" variable of all research, CHANCE.

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Final-Term Project Discussion

&

Lab Practice Session

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Lab Practice Session

The students will be given two hours session in Lab revision of what they have learnt in Post-mid

session.

1. The objectives of this session are to provide students an opportunity to

2. Revise the whole course that they have learnt throughout the post mid session

3. Have hands on practice on dealing with quantitative data using SPSS

4. Share their problems that they confront during revision and get the solution

5. Clarify if they have any ambiguity regarding understanding or application of any concept

regarding QTB

Final Project Discussion

The students will be given one hours session to discuss about the final draft of their final projects.

The objectives of this session are to provide students an opportunity to

1. Share their problems that they confront during revision and get the solution

2. Clarify if they have any ambiguity regarding understanding or application of any concept

regarding QTB

3. Get productive feedback on what they have done regarding their projects

The Drafts will be checked on the following criteria

The drafts will be checked if the following components are covered

1. Whether the survey is appropriately designed to collect the primary data

2. Whether the following components are appropriately discussed in the report

1. An introduction explaining the background and objectives of your work.

2. The Justification of the topic selection

3. A description of the data definitions of the variables, conclusions about data quality,

and so on.

4. A justification of the methods you have chosen to analyze the data.

5. Analysis and results descriptive as well as inferential with results

6. Conclusion a discussion and interpretation of your results and a summary of what you

have achieved.

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

7. Length: 1500 to 2000 words

PRESENTATION

on

Final Term Project

QUANTITATIVE TECHNIQUES IN BUSINESS QTB

Presentation

Students will be evaluated on the basis of following criteria.

1. Timing of presentation.

2. Clarity of concepts.

3. Structure of the presentation.

4. Quality of overheads, handouts etc.

5. Application of theory to practice.

6. Ability to answer questions effectively

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