Chapter 9 Hypothesis Tests: Single Population

9.1 Hypothesis Tests

- In statistics, a hypothesis is a claim or statement about a property of a population.

- A hypothesis test (or test of significance) is a standard procedure for testing a
claim about a property of a population.


9.1.1 Components of a Formal Hypothesis Test

- The null hypothesis (denoted by H
0
) is a statement that the value of a population
parameter is assumed to be true until it is declared false.

- The alternative hypothesis (denoted by H
1
or H
a
) is the statement that the
parameter has a value that somehow differs from the null hypothesis.


- Consider as a nonstatistical example a person who has been indicated for
committing a crime and is being tried in a court. Based on the available evidence,
the judge or jury will make one of two possible decisions:

1. The person is not guilty
2. The person is guilty

Null hypothesis: :
0
H The person is not guilty
Alternative hypothesis :
1
H The person is guilty


9.1.2 Rejection and nonrejection regions



- The critical region (or rejection region) is the set of all values of the test statistic
that cause us to reject the null hypothesis.

- The nonrejection region (or acceptance region) is the set of all values of the test
statistic that cause us not to reject the null hypothesis.

- The critical point is a value that separates the critical region and the nonrejection
region.

- The significance level (denoted by o) is the probability that the test statistic will
fall in the critical region when the null hypothesis is actually true.


9.1.3 Type I and Type II errors



- A Type I error occurs when a true null hypothesis is rejected. The value of o
represents the probability of committing this type of error, that is
) (
0 0
true is H rejected is H P = o
The value of o represents the significance level of the test.


- A Type II error occurs when a false null hypothesis is not rejected. The value of
| represents the probability of committing a Type II error, that is
) (
0 0
false is H rejected not is H P = |
The value of | 1 is called the power of the test. It represents the probability of
not making a Type II error.





9.1.4 Tails of a test

The tails in a distribution are the extreme regions bounded by critical values. Some
hypothesis tests are two-tailed (the critical region is in the two extreme regions), some are
left-tailed (the critical region is in the extreme left region) and some are right-tailed tests
(the critical region is in the extreme right region).




Example 9.2: Give the relevant null hypothesis and alternative hypothesis.
a) Knowing that the proportion of drivers who admit to running red lights is at least
0.5, test if the proportion has changed.

b) The mean height of professional basketball players is at most 7ft., test if the
claim has changed.

c) The standard deviation of IQ scores of actors is equal to 15, test if the score
i) has changed,
ii) is getting smaller,
iii) is getting bigger.



9.2 Hypothesis tests about : o known

Perform a test of hypothesis about population mean when the population standard
deviation is known. Three possible cases are

Case 1: If the following two conditions are fulfilled:
1. The sample size is small ( i.e., ) 30 < n
2. The population from which the sample is selected is normally distributed.
Use normal distribution to perform a test of hypothesis about .

Case 2: If the following condition is fulfilled:
1. The sample size is large (i.e., ) 30 > n
Use normal distribution to perform a test of hypothesis about .

Case 3: If the following two conditions are fulfilled:
1. The sample size is small ( i.e., ) 30 < n
2. The population from which the sample is selected is not normally distributed.
Use a nonparametric method to perform a test of hypothesis about .


9.2.1 Test statistic
- The test statistic is a value computed from the sample data, and it is used in
making the decision about the rejection of the null hypothesis
- Test statistic for mean,
n
x
z
o

=
- z is also called the calculated value/ observed value


9.2.2 The p-value approach
- Assuming that the null hypothesis is true, the p -value can be defined as the
probability that a sample statistic ( such as the sample mean) is at least as far
away from the hypothesized value in the direction of the alternative hypothesis as
the one obtained from the sample data under consideration.
- The p-value method in hypothesis testing
Right-tailed test: p-value = area to right of the test statistic z
Left-tailed test: p-value = area to left of the test statistic z
Two-tailed test: p-value = twice the area of the extreme region
bounded by the test statistic z
- Criteria of the decision making
Reject H
0
if p-value s o (the significance level)
Do not reject H
0
if p-value > o (the significance level)

Note that: p-value is the smallest significance level at which the null hypothesis is
rejected.

9.2.3 Steps to perform a test of hypothesis using the p-value approach
1. State the null and alternative hypothesis.
2. Select the distribution to use (test statistic).
3. Calculate the p-value.
4. Make a decision.

Example 9.1: A canon Food corporation, it took an average of 90 minutes for new
workers to learn a food processing job. Recently the company installed a new food
processing machine. The supervisor at the company wants to find if the mean time taken
by new workers to learn the food processing procedure on this new machine is different
from 90 minutes. A sample of 20 workers showed that it took, on average, 85 minutes for
them to learn the food processing procedure on the new machine. It is shown that the
learning times for all new workers are normally distributed with a population standard
deviation of 7 minutes. Find the p-value for the test that the mean learning time for the
food processing procedure on the new machine is different from 90 minutes. What will
your conclusion be if 01 . 0 = o ?

Solution:





























Example 9.2: The management of Priority Health Club claims that its members lose an
average of 10 pounds or more within the first month after joining the club. A consumer
agency that wanted to check this claim took a random sample of 36 members of this
health club and found that they lost an average of 9.2 pounds within the first month of
membership. The population standard deviation is known to be 2.4 pounds. Find the p-
value for this test. What will your decision be if 01 . 0 = o ? What if 05 . 0 = o ?

Solution:







































9.2.4 Critical-value approach
- We find the critical values(s) of z from the normal distribution table for the given
significance level.
- Compare the value of the test statistic with critical value and make a decision.

9.2.5 Steps to perform a test of hypothesis using the p-value approach
1. State the null and alternative hypothesis.
2. Select the distribution to use (test statistic).
3. Determine the rejection and nonrejection regions.
4. Calculate the value of the test statistic.
5. Make a decision.

Example 9.3: The TIV Telephone Company provides long-distance telephone service in
an area. According to the companys records, the average length of all long distances
calls placed through this company in 2004 was 12.44 minutes. The companys
management wanted to check if the mean length of the current long-distance calls is
different from 12.44 minutes. A sample of 150 such class placed through this company
produced a mean length of 13.71 minutes. The standard deviation of all such class is 2.65
minutes. Using the 2% significance level, can you conclude that the mean length of all
current long-distance calls is different from 12.44 minutes?

Solution:

























Example 9.4: The mayor of a large city claims that the average net worth of families
living in this city is at least $300000. A random sample of 25 families selected from this
city produced a mean net worth of $288000. Assume that the net worths of all families in
this city have a normal distribution with the population standard deviation of $80000.
Using the 2.5% significance level, can you conclude that the mayors claim is false?

Solution:








































9.3 Hypothesis Tests about : o not known

Perform a test of hypothesis about population mean when the population standard
deviation o is not known. Three possible cases are

Case 1: If the following two conditions are fulfilled:
1. The sample size is small ( i.e., ) 30 < n
2. The population from which the sample is selected is normally distributed.
Use t distribution to perform a test of hypothesis about .

Case 2: If the following condition is fulfilled
1. The sample size is large (i.e., ) 30 > n
Use normal distribution to perform a test of hypothesis about .

Case 3: If the following two conditions are fulfilled:
1. The sample size is small ( i.e., ) 30 < n
2. The population from which the sample is selected is not normally distributed (or
its distribution is unknown).
Use a nonparametric method to perform a test of hypothesis about .


9.3.1 Test statistic
- The value of the test statistic t for the sample mean x is computed as

x
s
x
t

= where
n
s
s
x
=

- The value of t calculated for x by using the above formula is also called the
observed value of t.

















1. The p-value approach

Example 9.5: A psychologist claims that the mean age at which children start walking is
12.5 months. Carol wanted to check if this claim is true. She took a random sample of 18
children and found that the mean age at which these children started walking was 12.9
months with a standard deviation of 0.80 months. It is known that the ages at which all
children start walking are approximately normally distributed. Find the p-value for the
test that the mean age at which all children start walking is different from 12.5 months.
What will your conclusion be if the significance level is 1%?

Solution:



































Example 9.6: Grand Auto Corporation produces auto batteries. The company claims that
its top-of-the-line Never Die batteries are good, on average, for at least 65 months. A
consumer protection agency tested 45 such batteries to check this claim. It found that the
mean life of these 45 batteries is 63.4 months and the standard deviation is 3 months.
Find the p-value for the test that the mean life of all such batteries is less than 65 months.
What will your conclusion be if the significance level is 2.5%?

Solution:







































2. Critical-value approach

Example 9.7: A psychologist claims that the mean age at which children start walking is
12.5 months. Carol wanted to check if this claim is true. She took a random sample of 18
children and found that the mean age at which these children started walking was 12.9
months with a standard deviation of 0.80 months. Using the 1% significance level, can
you conclude that the mean age at which all children start walking is different from 12.5
months? It is known that the ages at which all children start walking are approximately
normally distributed.

Solution:




































Example 9.8: The management at Massachusetts Savings Bank is always concerned
about the quality of service provided to its customers. With the old computer system, a
teller at this bank could serve, on average, 22 customers per hour. The management
noticed that with this service rate, the waiting time for customers was too long. Recently
the management of the bank installed a new computer system, expecting that it would
increase the service rate and consequently make the customers happier by reducing the
waiting time. To check if the new computer system is more efficient than the old system,
the management of the bank took a random sample of 70 hours and found that during
these hours the mean number of customers served by tellers was 27 per hour with a
standard deviation of 2.5. Testing at the 1% significance level, would you conclude that
the new computer system is more efficient than the old computer system?

Solution:


































9.4 Hypothesis tests about a population proportion : Large samples

- In tests of hypothesis about p for large samples ( np>5, n(1-p) > 5 ), the test
statistic is

n pq
p p
z

=

- The value of p is the one used in the null hypothesis, p q =1 .

Example 9.9: When working properly, a machine that is used to make chips for
calculators does not produce more than 4% defective chips. Whenever the machine
produces more than 4$ defective chips, it needs an adjustment. To check if the machine is
working properly, the quality control department at the company often takes samples of
chips and inspects them to determine if they are good or defective. One such random
sample of 200 chips taken recently from the production line contained 12 defective chips.
a) Find the p-value to test the hypothesis whether or not the machine needs an
adjustment.
b) What would your conclusion be if the significance level is 2.5%?

Solution: