HYPOTHESIS TESTING

T- TEST (ONE MEAN)

T- TEST (TWO MEANS)
ANALYSIS OF VARIANCE
OBJECTIVES:

1. Know what method to apply when conducting

statistical test.

2. Conduct significance test using the traditional

approach and probability value method.

3. Apply T-test and ANOVA in solving problems

involving test of hypothesis.
 APPROACHES IN HYPOTHESIS TESTING
TRADITIONAL
1. Formulate the null hypothesis and the
alternative hypothesis.
2. Set the level of significance and
select the appropriate test.
3. Establish the critical region.
4. Compute the value of the test statistic.
STEPS
5. Decide:
 Reject Ho if the value of test statistic
belongs to the critical region.
 Do not reject Ho if the value of the test
statistics does not belong to the critical
region.
6. Make a conclusion.
P-VALUE
1. Formulate the null hypothesis and the
alternative hypothesis.
2. Set the level of significance.
select the appropriate test.
3. Compute the value of the test statistic.
4. Decide:
 Reject Ho if the p-value is less than α
 Do not reject Ho if the p-value is greater
(or equal) than α
5. Make a conclusion.
 HYPOTHESIS TEST FOR µ

σ known σ unknown

Z-test T-test Analysis of Variance

One mean
Three or more
Two means means
 𝑯𝒐 : 𝝁 = 𝝁𝒐
HYPOTHESIS TEST FOR ONE MEAN ҧ 0
𝑥−𝜇
Test Statistic: 𝑡𝑐 =
𝑠/ 𝑛
Given: 𝑥ҧ = sample mean
The average daily earnings for 𝜇0 = 623 𝜇0 = hypothesized mean
those working in a hospital is 𝑛 = 21 𝑠 = sample standard deviation
P623. A group of employees 𝑥ҧ = 650 𝑛 = sample size
working for a private hospital 𝑠 = 71
felt that they earned more. α = 0.05
The mean daily earning for a
random sample of 21
employees showed an average
daily earnings of P650 with a
standard deviation of P71. At
0.05 level of significance, can
it be concluded that the
employees are correct?
HYPOTHESIS TEST FOR ONE MEAN
1. HO: 𝜇 ≤ 623 (The average daily earnings for those
The average daily earnings for working in a hospital is not more than P623.)
those working in a hospital is HA : 𝜇 > 623 (The average daily earnings for those working
P623. A group of employees in a hospital is more than P623.)
working for a private hospital 2. σ is unknown 3. α = 0.05
felt that they earned more. t-test @ α=0.05
The mean daily earning for a df = 20
random sample of 21
ҧ 0
𝑥−𝜇 650−623 𝑡𝛼 = 1.725
employees showed an average 4. 𝑡𝑐 = = = 1.7427
𝑠/ 𝑛 71/ 21
daily earnings of P650 with a
standard deviation of P71. At 5. Since 𝑡𝑐 > 𝑡𝛼 , reject HO.
0.05 level of significance, can
it be concluded that the 6. The evidence is enough to conclude that the average
employees are correct? daily earnings for those working in a hospital is more than
P623.
HYPOTHESIS TEST FOR ONE MEAN
1. HO: 𝜇 = 120 (The mean amount per sales invoice is $120.)
The following data invoices are HA : 𝜇 ≠ 120 (The mean amount per sales invoice differs
the amounts (in dollars) in a from $120.)
random sample of 12 sales
invoices. 2. σ is unknown 3. α/2 = 0.025 α/2 = 0.025
108.98 152.22 111.45 t-test @ α=0.05
110.59 127.46 107.26 df = 11 −𝑡𝛼/2 = −2.201 +𝑡𝛼/2 = 2.201
93.32 91.97 111.56
ҧ 0
𝑥−𝜇 112.8508−120
75.71 128.58 135.11 4. 𝑡𝑐 = = = −1.1908
𝑠/ 𝑛 20.7980/ 12
5. Since −𝑡𝛼/2 < 𝑡𝑐 < +𝑡𝛼/2 , do not reject HO.
At 0.05 level of significance, is
there sufficient evidence to 6. The evidence is not enough to conclude that the mean
conclude that the mean amount per sales invoice differs from $120.
amount per sales invoice differs
from $120?
HYPOTHESIS TEST FOR TWO MEANS
𝑯𝒐 𝑯𝑨 Critical Region Value of Test Statistic

𝜎1 = 𝜎2 but unknown

𝑥ҧ 1 −𝑥ҧ2 −𝛿 𝑛1 −1 𝑠12 +(𝑛2 −1)𝑠22

𝑡𝑐 = , 𝑠𝑝2 =
𝜇1 − 𝜇2 ≤ 𝛿 𝜇1 − 𝜇2 > 𝛿 Reject H0 if 𝑡𝑐 ≥ 𝑡𝛼 𝑠𝑝
1
+
1 𝑛1 +𝑛2 −2
𝑛1 𝑛2

𝜇1 − 𝜇2 ≥ 𝛿 𝜇1 − 𝜇2 < 𝛿 Reject H0 if 𝑡𝑐 ≤ −𝑡𝛼 where: df = 𝑛1 + 𝑛2 − 2

𝜇1 − 𝜇2 = 𝛿 𝜇1 − 𝜇2 ≠ 𝛿 Reject H0 if 𝑡−𝑡 > 𝑡𝛼/2

𝑐 𝛼/2 ≤ 𝑡𝑐 ≤ 𝑡𝛼/2
or 𝑡𝑐 < −𝑡𝛼/2 𝜎1 ≠ 𝜎2 but unknown

𝑥ҧ 1 −𝑥ҧ 2 −𝛿
𝑡𝑐 =
𝑠2 2
1 + 𝑠2
𝑛1 𝑛2
2
𝑠1 2 𝑠2 2
+
𝑛1 𝑛2
where df = 2 2
𝑠1 2 ൗ𝑛1 𝑠2 2 ൗ𝑛2
𝑛1 −1
+ 𝑛 −1
2
HYPOTHESIS TEST FOR TWO
ONE MEAN
MEANS
1. H0 : 𝜇A − 𝜇B = 0 (There is no significant difference between the
The following are test scores on a
mean scores of the two colleges.)
standardized examination HA : 𝜇A − 𝜇B ≠ 0 (There is a significant difference between the
administered to a random mean scores of the two colleges.)
sample of 15 students in college 2. σ is unknown, t-test @ α=0.05
A and 10 students in college B. 3. t-Test: Two-Sample Assuming Equal Variances
Grades in college A are 75, 88, 65, Variable 1 Variable 2
100, 100, 95, 82, 57, 42, 100, 72, Mean 80 75
Variance 376.1428571 340.2222222
49, 100, 85, and 90; and grades in Observations 15 10
college B are 95, 80, 72, 63, 100, Pooled Variance 362.0869565
45, 81, 92, 50, and 72. Use 0.05 Hypothesized Mean
level of significance to test Difference 0
df 23
whether the difference between t Stat 0.643634314
the means of these two samples P(T<=t) one-tail 0.263089503
is significant. t Critical one-tail 1.713871528
P(T<=t) two-tail 0.526179005
t Critical two-tail 2.06865761
HYPOTHESIS TEST FOR TWO
ONE MEAN
MEANS
t-Test: Two-Sample Assuming Equal Traditional Approach P-Value Approach
Variances
Variable 1 Variable 2 1. H0 : 𝜇A − 𝜇B = 0 1. H0 : 𝜇A − 𝜇B = 0
Mean 80 75 HA : 𝜇A − 𝜇B ≠ 0 HA : 𝜇A − 𝜇B ≠ 0
Variance 376.1428571 340.2222222 2. σ is unknown 2. σ is unknown
Observations 15 10 t-test @ α=0.05 t-test @ α=0.05
Pooled Variance 362.0869565 3. p-value = 0.5262
3. Reject H0 if
Hypothesized
Mean Difference 0 𝑡𝑐 > 𝑡𝛼/2 or 𝑡𝑐 < −𝑡𝛼/2 4. Do not reject H0
df 23 i.e,𝑡𝑐 > 2.0687 or 𝑡𝑐 < −2.0687 since p-value > α.
t Stat 0.643634314 4. 𝑡𝑐 = 0.6436 5. There is no
P(T<=t) one-tail 0.263089503 5. Do not reject H0 since significant difference
t Critical one-tail 1.713871528 −2.0686 ≤ 0.6463 ≤ 2.0686 between the mean
P(T<=t) two-tail 0.526179005
6. There is no significant scores of the two
t Critical two-tail 2.06865761
difference between the mean colleges.
scores of the two colleges.
HYPOTHESIS TEST FOR TWO
ONE MEAN
MEANS
The following data represent the running times of films produced by two different motion picture
companies:
Company Time (in minutes)
A 102 68 98 109 92
B 81 165 97 143 92 78 114

Test the hypothesis that the average running time of films produced by Company B exceeds the average
running time of films produced by Company A by 10 minutes. Use 0.05 and 0.01 level of significance and
assume the distribution is normal and the population variances are not equal.

1. H0 : 𝜇A − 𝜇B ≥ 10 (The average running time of films produced by Company B exceeds the average
running time of films produced by Company A by 10 minutes.)
HA : 𝜇A − 𝜇B < 10 (The average running time of films produced by Company B exceeds the average
running time of films produced by Company A by 10 minutes.)

2. σ is unknown, t-test @ α=0.05 and 0.01

HYPOTHESIS TEST FOR TWO
ONE MEAN
MEANS
α=0.05 α=0.01

t-Test: Two-Sample Assuming Unequal t-Test: Two-Sample Assuming Unequal

Variances Variances
Variable 1 Variable 2 Variable 1 Variable 2
Mean 93.8 110 Mean 93.8 110
Variance 246.2 1081.333333 Variance 246.2 1081.333
Observations 5 7 Observations 5 7
Hypothesized Hypothesized
Mean Difference 10 Mean Difference 10
df 9 df 9
t Stat -1.83564425 t Stat -1.83564
P(T<=t) one-tail 0.049799336
P(T<=t) one-tail 0.049799
t Critical one-tail 1.833112933
P(T<=t) two-tail 0.099598672 t Critical one-tail 2.821438
t Critical two-tail 2.262157163 P(T<=t) two-tail 0.099599
t Critical two-tail 3.249836
HYPOTHESIS TEST FOR TWO
ONE MEAN
MEANS
t-Test: Two-Sample Assuming Unequal Traditional Approach P-Value Approach
Variances
1. H0 : 𝜇A − 𝜇B ≥ 10 1. H0 : 𝜇A − 𝜇B ≥ 10
Variable 1 Variable 2
HA : 𝜇A − 𝜇B < 10 HA : 𝜇A − 𝜇B < 10
Mean 93.8 110
2. σ is unknown, t-test @ α=0.05 2. σ is unknown, t-test @ α=0.05
Variance 246.2 1081.333333
3. Reject H0 if 𝑡𝑐 ≤ −𝑡𝛼 3. p-value = 0.0498
Observations 5 7
4. 𝑡𝑐 = −1.8356
Hypothesized 5. Reject H0 since 4. Reject H0 since p-value < α.
Mean Difference 10 −1.8356 ≤ 1.8331
df 9 6. The evidence is not enough to 5. The evidence is not enough to
t Stat -1.83564425 conclude that the average running conclude that the average running
P(T<=t) one-tail 0.049799336 time of films produced by Company time of films produced by Company
t Critical one-tail 1.833112933 B exceeds the average running time B exceeds the average running time
P(T<=t) two-tail 0.099598672 of films produced by Company A by of films produced by Company A by
t Critical two-tail 2.262157163 10 minutes. 10 minutes.
 HYPOTHESIS
HYPOTHESIS TEST
TEST FOR FOR
TWO ONE MEAN
MEANS
t-Test: Two-Sample Assuming Unequal Traditional Approach P-Value Approach
Variances
1. H0 : 𝜇A − 𝜇B ≥ 10 1. H0 : 𝜇A − 𝜇B ≥ 10
Variable 1 Variable 2 HA : 𝜇A − 𝜇B < 10 HA : 𝜇A − 𝜇B < 10
Mean 93.8 110 2. σ is unknown, t-test @ α=0.01 2. σ is unknown, t-test @ α=0.01
Variance 246.2 1081.333 3. Reject H0 if 𝑡𝑐 ≤ −𝑡𝛼 3. p-value = 0.0498
Observations 5 7 4. 𝑡𝑐 = −1.8356
Hypothesized 5. Do not reject H0 since 4. Do not reject H0 since p-value > α.
Mean Difference 10 −2.8214 > −1.8356
df 9 5. The evidence is enough to
t Stat -1.83564 6. The evidence is enough to conclude that the average running
conclude that the average running time of films produced by Company
P(T<=t) one-tail 0.049799
time of films produced by Company B exceeds the average running time
t Critical one-tail 2.821438 B exceeds the average running time of films produced by Company A by
P(T<=t) two-tail 0.099599 of films produced by Company A by 10 minutes.
t Critical two-tail 3.249836 10 minutes.
HYPOTHESIS TEST FOR THREE
ONE MEAN
OR MORE MEANS
ANALYSIS OF 𝐻0 : 𝜇1 = 𝜇2 = 𝜇3 =∙ ∙ ∙ = 𝜇𝑘
VARIANCE 𝐻1 : 𝑎𝑡 𝑙𝑒𝑎𝑠𝑡 𝑜𝑛𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑚𝑒𝑎𝑛 𝑖𝑠 𝑑𝑖𝑓𝑓𝑒𝑟𝑒𝑛𝑡 𝑓𝑟𝑜𝑚 𝑡ℎ𝑒 𝑜𝑡ℎ𝑒𝑟𝑠
Source 𝑘 𝑛
of
Sum of Degrees of Mean Compute
2 𝑦. .2
Squares Freedom Square dF 𝑆𝑆𝑇 = ෍ ෍ 𝑦𝑖𝑗 −
Variation 𝑁
𝑖=1 𝑗=1 SSC
SSB MSC 
(sum of
df1 = k – 1 𝑘
𝑦𝑖.2 𝑦. .2 k 1
(k is the 𝑆𝑆𝐶 = ෍ −
Between squares MSB 𝑛𝑖 𝑁 SSE
number of
between 𝑖=1 MSE 
groups)
groups) Nk
SSE df2 = N – k SSE  SST  SSC
MSC
Within (sum of (N sum of f
MSW MSE
(Error) squares sample sizes
within groups) for groups)

Total SST N–1 XXXXXX Reject 𝐻0 if 𝒇𝑐 ≥ 𝒇∝ or p-value < α

HYPOTHESIS TEST FOR THREE
TWO
ONE MEAN
MEANS
OR MORE MEANS

1. A company bought a number of 30-second advertisements at different radio stations

across the country. The stations were randomly selected from those whose music
programming was popular, classical, or western. Each different station gave a different
address so the number of buyers from each could be determined; the results are given
below. Perform an analysis of variance to test at 0.05 level of significance whether the
mean number of buyers differ from each station.
Programming
Popular Classical Western
32 17 22
30 19 24
31 16 25
28 15 20
26 13 16
24 17 19
HYPOTHESIS TEST FOR THREE
TWO
ONE MEAN
MEANS
OR MORE MEANS
1. A company bought a number of 30-second 1. 𝐻0 : 𝜇1 = 𝜇2 = 𝜇3 =∙ ∙ ∙ = 𝜇𝑘
advertisements at different radio stations The mean number of buyers does not differ from each station.
across the country. The stations were
randomly selected from those whose
music programming was popular, 𝐻1 : 𝑎𝑡 𝑙𝑒𝑎𝑠𝑡 𝑜𝑛𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑚𝑒𝑎𝑛 𝑖𝑠 𝑑𝑖𝑓𝑓𝑒𝑟𝑒𝑛𝑡 𝑓𝑟𝑜𝑚 𝑡ℎ𝑒 𝑜𝑡ℎ𝑒𝑟𝑠
classical, or western. Each different The mean number of buyers differ from each station.
station gave a different address so the
number of buyers from each could be 2. ANOVA @ α=0.05
determined; the results are given below.
Perform an analysis of variance to test at 3. Reject 𝐻0 if 𝒇𝑐 ≥ 𝒇∝ or p-value < α
0.05 level of significance whether the
mean number of buyers differ from each 4. ANOVA
station.
Programming Source of Variation SS df MS F P-value F crit
Popular Classical Western Between Groups 463.4444 2 231.722 27.9557 8.72E-06 3.68232
32 17 22 Within Groups 124.3333 15 8.2888
30 19 24
31 16 25 Total 587.77778 17
28 15 20
26 13 16
24 17 19
HYPOTHESIS TEST FOR THREE
TWO
ONE MEAN
MEANS
OR MORE MEANS
1. A company bought a number of 30-second 4.
advertisements at different radio stations ANOVA
across the country. The stations were Source of Variation SS df MS F P-value F crit
randomly selected from those whose Between Groups 463.4444 2 231.722 27.9557 8.72E-06 3.68232
music programming was popular, Within Groups 124.3333 15 8.2888
classical, or western. Each different
station gave a different address so the Total 587.77778 17
number of buyers from each could be
determined; the results are given below. 5. Reject 𝐻0 since 𝒇𝑐 𝟐𝟕. 𝟗𝟔 > 𝒇∝ (𝟑. 𝟔𝟖) or 8.72E-06 < 0.05)
Perform an analysis of variance to test at
0.05 level of significance whether the 6. The mean number of buyers differ from each station.
mean number of buyers differ from each
station.
Programming
Popular Classical Western
32 17 22
30 19 24
31 16 25
28 15 20
26 13 16
24 17 19
HYPOTHESIS TEST FOR THREE
TWO
ONE MEAN
MEANS
OR MORE MEANS
1. 𝐻0 : 𝜇1 = 𝜇2 = 𝜇3 =∙ ∙ ∙ = 𝜇𝑘
Following are the numbers of The mean number of microwave ovens sold by each of the
microwave ovens sold by each of salespersons at the three branches of a retail appliance sales company
the salespersons at the three is not significant.
branches of a retail appliance
𝐻1 : 𝑎𝑡 𝑙𝑒𝑎𝑠𝑡 𝑜𝑛𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑚𝑒𝑎𝑛 𝑖𝑠 𝑑𝑖𝑓𝑓𝑒𝑟𝑒𝑛𝑡 𝑓𝑟𝑜𝑚 𝑡ℎ𝑒 𝑜𝑡ℎ𝑒𝑟𝑠
sales company: The mean number of microwave ovens sold by each of the
Alpha branch 21 11 17 28
salespersons at the three branches of a retail appliance sales company
Beta branch 27 15 18 26 17 21
Gamma branch 24 17 31 12 15
is not significant..

2. ANOVA @ α=0.025
Perform an analysis of
variance to test at the 0.025 level 3. Reject 𝐻 if 𝒇 ≥ 𝒇 or p-value < α
0 𝑐 ∝
of significance whether the
differences among the means of
the three samples are not
significant.
HYPOTHESIS TEST FOR THREE
TWO
ONE MEAN
MEANS
OR MORE MEANS
4. ANOVA
Following are the numbers of Source of
microwave ovens sold by each of Variation SS df MS F P-value F crit
the salespersons at the three Between Groups 5.116667 2 2.558333 0.060328 0.941739 5.095867
branches of a retail appliance Within Groups 508.8833 12 42.40694

sales company: Total 514 14

Alpha branch 21 11 17 28
Beta branch 27 15 18 26 17 21
Gamma branch 24 17 31 12 15 5. Do not reject 𝐻0 since 𝒇𝑐 0.0603 < 𝒇∝ (5.095𝟗) or
0.941739 > 0.025
Perform an analysis of
6. The mean number of microwave ovens sold by each of the
variance to test at the 0.025 level salespersons at the three branches of a retail appliance sales company
of significance whether the is not significant.
differences among the means of
the three samples are not
significant.