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Region of rejection consists of the values of the test statistic that are unlikely to occur if
the null hypothesis is true
o These values are much more likely to occur if the null is false
To make a decision concerning the null hypothesis, you first determine the critical value
of the test statistic
o Critical value divides the nonrejection region from the rejection region
Risks in Decision Making Using Hypothesis Testing
Type 1 error-occurs if you reject the null when it is true and should not be rejected; is a
false alarm
o Probability of Type 1 error occurring is (level of significance)
Chapter 9: Fundamentals if Hypothesis Testing: One-Sample Tests
(1-) is the confidence coefficient, probability that you will not reject the
null when it is true
Type 2 error-occurs if you do no reject the null when it is false and should be rejected;
represents a missed opportunity to take some corrective action
o Probability of Type 2 error occurring is
Depends on the difference btwn the hypothesized and actual values of the
population parameter
When the difference is large, is small
(1- ) is the power of a statistical test, probability that you will
reject the null when it is false and should be rejected
you can reduce the probability of type 2 error by increasing the sample
size, allowing to detect small differences
however when reduce you increase and vice cersa
t test is robust, meaning that it does not lose power if the shape of the population
departs somewhat from the normal distribution as long as the sample size is large
One-Tail Tests
have an alternative hypothesis that focuses on a particular direction
Z Test of Hypothesis for the Proportions
sample proportion, p=X/n
if the numbers of events of interest(X) and the number of events that are not of interest
(n-X) are each at least five, you can use the Z test for the propotion