Hypothesis

Testing
(A Comprehensive Study)
Hypothesis Testing
Hypothesis Testing is a decision-making process
for evaluating claims about a population based
on the characteristics of a sample purportedly
coming from the that population. The decision is
whether the characteristic is acceptable or not.

2
Null versus Alternative
Null hypothesis is a statement that there is no
difference between a paramenter and a specific
value, or that there is no difference between two
parameters while alternative hypothesis is a
statement that there is a difference between a
paramenter and a specific value, or that there
3
Types of
Test
Types of Test
A statistical test may either be directional (one-
tailed) or nondirectional (two-tailed). We can
determine whether a test is directional or
nondirectional by looking at how the alternative
hypothesis is expressed.

5
Nondirectional Test
A test of any statistical hypothesis where the
alternative hypothesis is written with a not equal
sign (≠) is called a nondirectional test or two-
tailed test since there is no assertion made on
the direction of the difference. The rejection
region is split into two equal parts, one in each
6
Directional Test
A test of any statistical hypothesis where the
alternative hypothesis is expressed using less
than (<) or greater than (>) is called
direcctional test or one-tailed test since the
critical or rejection region lies entirely in one tail
of the sampling distribution.
7
Types of
Error
Types of Error
In decision making, we sometimes make a
wrong decision. Likewise, when we test a
hypothesis, there is a possibility that we shall
also commit an error of accepting or rejecting
the hypothesis.

9
Type I Error (Alpha
Error)
It occurs when we reject
the null hypothesis when
it is true.

1
Type II Error (Beta
Error)
It occurs when we accept
the null hypothesis when it
is false.

1
Types of Error
(Summary)
Four Possible Outcomes in Decision Making
(Decision about the Null
Hypothesis)
REJECT DO NOT REJECT
Ho (or accept
Ha)
(Realit

Null Hypothesis Type I Error Correct decision

is
true.
Null Hypothesis Correct decision Type II Error 1
Critical Value
of z
Critical Value of z

Level of
Type of Test Significance Ƌ = 0.05
Ƌ = 0.01

One-tailed ±2.33 ±1.65

Two-tailed ±2.58 ±1.96

1
Five-Step
Procedures in
Hypothesis Testing
Step 1
-Identify the claim and formulate the
null and alternative hypothesis.

1
Step 2
-Set the level of significance and determine
whether the test is one-tailed or two-tailed by
looking at how the alternative hypothesis is
expressed. Decide on the test statistic to be
used and find the critical value for the test.
Draw and illustrate the rejection region.
1
Step 3
-Compute the test value, using the test
statistic or formula for the test.

1
Step 4
-Make a decision whether to accept or
reject the null hypothesis.

1
Step 5
-Formulate a conlusion by answering the
research question.

2
Several Cases to
Considered in Testing
Hypothesis
Several Cases to Considered in Testing
Hypothesis
[Link] for single population.
2. Hypotheses for two populations.
3. Hypotheses for multiple
populations.
[Link] for difference in
frequencies.
2
The z-test of One-
Sample Mean
The z-test of One-Sample Mean

2
The z-test of One-Sample Mean

Mean of
the
Mean of the
sample
population
Z-test
Standard deviation
of
the population
Size of the
sample
2
Problem 1:
A new drug on the market is claimed by its
manufacturers to reduce overweight women by
4.55 kg per month with a standard deviation of
0.91 kg. Ten women chosen at random have
reported losing an average of 4.05 kg within a
month. Does this data support the claim of the
2
Step 1: Formulate hypotheses
H0 = The average weight loss per month using
a new drug is equal to 4.55 kg
Ha = The average weight loss per month using
a new drug is not equal to 4.55 kg

2
Step 2: Type of
test
Critical value
(z) =

Rejection region:

2
Step 3: Compute the test
value.

2
Step 4: Decision
Since the computed or test value does not fall
within the rejection region, we accept the null
hypothesis.

3
Step 4: Conclusion
There is no significant difference between the
sample mean and population mean. Thus, the
manufacturer is correct in claiming that the new
drug in the market can reduce overweight women
by 4.55 kg per month.

3
Problem 2:
A sociologist believes that it costs more than Php
90,000 to raise a child from birth to age one. A
random sample of 49 families, each with a child is
selected to see if this figure is correct. The average
expenses for these families reveal a mean of Php
92,000 with a standard deviation of Php 4,500. Based
on these sample data, can it be concluded that the
3
Step 1: Formulate hypotheses
H0 = The average cost to raise a child from
birth to age one is equal to Php 90, 000.
Ha = The average cost to raise a child from
birth to age one is more than Php 90, 000.

3
Step 2: Type of
test
Critical value
(z) =

Rejection region:

3
Step 3: Compute the test
value.

3
Step 4: Decision
Since the computed or test value falls within
the rejection region, we reject the null
hypothesis then accept the alternative
hypothesis.

3
Step 5: Conclusion
There is a significant difference between the
sample mean and population mean. Thus, the
sociologist is correct in claiming that the cost to
raise a child from birth to age one is more than
Php 90, 000.

3
Problem 3:
The production manager of a large manufacturing company
estimates that the mean age of his employees is 22.8 years. The
treasurer of the firm needs more accurate employee mean age
figure in order to estimate the cost of an annuity benefit
program being considered for employees. The treasurer takes a
random sample of 70 workers and finds out that the mean age
of the employees sampled is 26.2 years with a standard
deviation of 4.6 years. At the 0.01 level of significance, what can
the treasurer conclude about the accuracy of the production 3
Step 1: Formulate hypotheses
H0 = The mean age of the employees
in a large manuacturing company is
equal to 22.8 years.
Ha = The mean age of the employees in
a large manufacturing company is not
equal to 22.8 years. 3
Step 2: Type of
test
Critical value
(z) =

Rejection region:

4
Step 3: Compute the test
value.

4
Step 4: Decision
Since the computed or test value falls within
the rejection region, we reject the null
hypothesis then accept the alternative
hypothesis.

4
Step 5: Conclusion
There is a significant difference between the
sample mean and population mean. Thus, the
production manager of a large manufacturing
company is incorrect in claiming that the
estimation of the average age of his employees
is equal to 22.8 years.
4