Business

Research Methods
William G. Zikmund

Chapter 21:
Univariate Statistics

introduction
Statistical analysis can be divided into several
groups
Univariate statistical analysis: tests of hypotheses
involving only one variable
Bivariate statistical analysis: tests of hypotheses
involving two variables
multivarate statistical analysis: tests of hypotheses
involving three or more variables or set of
variables

Hypothesis testing
Hypotheses are formal statements of
explanations stated in a testable form
Relational hypothesis: examine how change in
one variable vary with change in another
variable
Hypothesis about difference between groups:
examine how some variables varies from one
group to another
Hypothesis about difference from some
standard:

Hypothesis
Unproven proposition
Supposition that tentatively explains certain
facts or phenomena
Assumption about nature of the world
An unproven proposition or supposition that
tentatively explains certain facts or
phenomena
Null hypothesis
Alternative hypothesis

Null Hypothesis
Statement about the status quo
No difference exists between groups being
compare
No relationship between variable being
analyzed

Alternative Hypothesis
Statement that indicates the opposite of the
null hypothesis
There is significant difference between
groups being compared
There is a significant relationship between
variable

 Directional and non-directional hypothesis

A nondirectional alternative hypothesis states that
the null hypothesis is wrong. A nondirectional
alternative hypothesis does not predict whether
the parameter of interest is larger or smaller than
the reference value specified in the null
hypothesis.
A directional alternative hypothesis states that the
null hypothesis is wrong, and also specifies
whether the true value of the parameter is greater
than or less than the reference value specified in
null hypothesis.

The null hypothesis that the mean is

equal to 3.0:

H o : 3.0

The alternative hypothesis that the

mean does not equal to 3.0:

H 1 : 3 .0

Type I and Type II Errors

Accept null

Null is true

Null is false

Reject null

Correctno error

Type I
error

Type II
error

Correctno error

Type I and Type II Errors

in Hypothesis Testing
State of Null Hypothesis
in the Population

Decision
Accept Ho

Reject Ho

Ho is true
Ho is false

Correct--no error
Type II error

Type I error
Correct--no error

When the null hypothesis is true and you reject it, you make a type I error.
The probability of making a type I error is , which is the level of significan
you set for your hypothesis test. An of 0.05 indicates that you are willing
accept a 5% chance that you are wrong when you reject the null hypothesi
To lower this risk, you must use a lower value for . However, using a lowe
value for alpha means that you will be less likely to detect a true difference
if one really exists.

 When the null hypothesis is false and you

fail to reject it, you make a type II error.
The probability of making a type II error is
, which depends on the power of the test.
You can decrease your risk of committing a
type II error by ensuring your test has
enough power. You can do this by ensuring
your sample size is large enough to detect a
difference when one truly exists.

Significance Level
Critical probability in choosing between the null
hypothesis and the alternative hypothesis
The acceptable level of type one error
significance or alpha () level, which is also set
ahead of time, usually at 0.05 (5%)
Acceptable amount of error
Probability Level selected is typically .05 or .01
Too low to warrant support for the null
hypothesis

P-value
P-ValueThe probability value (p-value) of a statistical hypothesis
test is the probability of getting a value of the test statistic as
extreme as or more extreme than that observed by chance alone, if
the null hypothesis H0, is true.
It is the probability of wrongly rejecting the null hypothesis if it is
in fact true.

It is exact probability of committing type one error

Computed significance level
P-value are compared with significance level to
test hypothesis
P-value <
reject null hypothesis
P-value >
cannot reject null hypothesis

Choosing the Appropriate

Statistical Technique
Type of question to be answered
Number of variables
Univariate
Bivariate
Multivariate

Scale of measurement

PARAMETRIC
STATISTICS

NONPARAMETRIC
STATISTICS

Parametric statistics
When data are interval or
ratio
Sample size is large
Numbers with known,
continuous distribution

Non-parametric statistics
Numbers do not confirm to
a known distribution
When data are either ordinal
or nominal

A Sampling Distribution

A Sampling Distribution

A Sampling Distribution

UPPER
LIMIT

LOWER
LIMIT

Critical values of
Critical value - upper limit

S
ZS X or Z
n
1.5
3.0 1.96

225

Critical values of

3.0 1.96 0.1

3.0 .196

3.196

Critical values of
Critical value - lower limit

- ZS X or - Z

3.0 - 1.96

1 .5
225

S
n

Critical values of

3.0 1.96 0.1

3.0 .196

2.804

Region of Rejection

LOWER
LIMIT

UPPER
LIMIT

Hypothesis Test

2.804

3.196

3.78

Calculating Zobs

x
z
sx
obs

Alternate Way of Testing the

Hypothesis

Z obs

SX

Alternate Way of Testing the

Hypothesis

Z obs

3.78
3.78 3.0

SX
.1
0.78

.1

7.8

t-Distribution

Symmetrical, bell-shaped distribution

Mean of zero and a unit standard deviation
Shape influenced by degrees of freedom
As sample size increases t distribution
approaches normal distribution
t-test is hypothesis test that use t
distribution. Appropriate when the variable
is interval or ratio. strictly appropriate for
small samples

Degrees of Freedom
Abbreviated d.f.
Number of observations-Number of
constraints

Confidence Interval Estimate

Using the t-distribution

X tc.l . S X
Upper limit X tc.l .
or

Lower limit X tc.l .

S
n
S
n

Confidence Interval Estimate Using

the t-distribution

= population mean
X = sample mean
tc.l . = critical value of t at a specified confidence
SX
S
n

level
= standard error of the mean
= sample standard deviation
= sample size

Confidence Interval Estimate Using

the t-distribution

X t cl s x
X 3.7
S 2.66
n 17

upper limit 3.7 2.12(2.66 17 )

5.07

Lower limit 3.7 2.12( 2.66 17 )

2.33

Hypothesis Test Using the

t-Distribution

Univariate Hypothesis Test

Utilizing the t-Distribution
Suppose that a production manager believes
the average number of defective assemblies
each day to be 20. The factory records the
number of defective assemblies for each of the
25 days it was opened in a given month. The
mean X was calculated to be 22, and the
standard deviation, S ,to be 5.

H 0 : 20
H1 : 20

SX S / n
5 / 25
1

Univariate Hypothesis Test

Utilizing the t-Distribution
The researcher desired a 95 percent
confidence, and the significance level
becomes .05.The researcher must then find
the upper and lower limits of the confidence
interval to determine the region of rejection.
Thus, the value of t is needed. For 24 degrees
of freedom (n-1, 25-1), the t-value is 2.064.

Lower limit :

tc.l . S X 20 2.064 5 / 25
20 2.0641
17.936

Upper limit :

t c.l . S X 20 2.064 5 / 25
20 2.0641
20.064

Univariate Hypothesis Test

t-Test

tobs

X
22 20

SX
1
2

1
2

Testing a Hypothesis about a

Distribution
Chi-Square test
Test for significance in the analysis of
frequency distributions
Compare observed frequencies with
expected frequencies
Goodness of Fit

Chi-Square Test

(Oi Ei )
x
Ei

Chi-Square Test
x = chi-square statistics
Oi = observed frequency in the ith cell
Ei = expected frequency on the ith cell

Chi-Square Test
Estimation for Expected Number
for Each Cell

Eij

Ri C j
n

Chi-Square Test
Estimation for Expected Number
for Each Cell
Ri = total observed frequency in the ith row
Cj = total observed frequency in the jth column
n = sample size

Univariate Hypothesis Test

Chi-square Example

O1 E1

E1

O2 E2

E2

Univariate Hypothesis Test

Chi-square Example

60 50

50

40 50

50

Hypothesis Test of a Proportion

is the population proportion
p is the sample proportion
is estimated with p

Hypothesis Test of a Proportion

H0 : . 5
H1 : . 5

Sp

0.6 0.4
100

.0024

.24

100
.04899

.6 .5
p

Zobs
.04899
Sp
.1
2.04

.04899

Hypothesis Test of a Proportion:

Another Example
n 1,200
p .20
Sp

pq
n

Sp

(.2)(.8)
1200

Sp

.16
1200

Sp .000133
Sp . 0115

Hypothesis Test of a Proportion:

Another Example
n 1,200
p .20
Sp

pq
n

Sp

(.2)(.8)
1200

Sp

.16
1200

Sp .000133
Sp . 0115

Hypothesis Test of a Proportion:

Another Example
Z

p
Sp

.20 .15
.0115
.05
Z
.0115
Z 4.348
The Z value exceeds 1.96, so the null hypothesis should be rejected at the .05 level.
Indeed it is significantt beyond the .001
Z