ANALYSIS

OF
VARIANCE
ANOVA

Example - 1
To test the significance of
variation in the retail price of a
commodity in three cities
Mumbai, Kolkata and Delhi ,4
shops were treatment were
Mumb at
16 random
8
12 each
14 city
chosen
in
ai
andKolkat
price14observed
are as
10
10
6
a
follows
Delhi

10

Example -1 Solution

Let us take the hypothesis that

there is no significant difference
in the prices of a commodity in
three cities. Calculations for
Sample1
Sample2
Sample
analysis of variance
are as under
Mumbai

Kolkata

Delhi

x1

x1

x2

x2

x3

x3

16

256

14

196

16

64

10

100

10

100

12

144

10

100

64

14

196

36

64

x2=4
0

x2=4 x3=3
32
0

x1=5 x1=6
0
60

x3=2
44

Example -1 Solution
There are r=3 treatments (samples) with n 1=4,
n2=4, n3=4 and n=12
T=Sum of all the observations in three samples
= x1+x2+x3 = 50+40+30 = 120
CF=correction factor = T/n = 120/12 = 1200
SSy=total sum of squares
=(x1+x2+x3)-CF = (660+432+244) 1200
= 136

Example -1 Solution
SSx=sum of squares between samples
(x1) + (x2) + (x3)
CF
=
n1
n2
n3
(50) + (40)
+ (30)
1200
4
4
4
=
(2500) + (1600) +(900)
1200 =
=50
4
4
4
SSE = SSy - SSx = 136-50 = 86

Example -1 Solution
Degrees of freedom df1=r-1=3-1=2;
df2=n-r=123=9
Thus MSx=SSx/df1=50/2=25
Sum
of Degree Mean
Test
MSESource
=SS
E/df
2=86/9=9.55
of
squares of
squares statisti
variatio
n

freedo
m

Betwee
n
sample
s

50

25

Within
sample

86

9.55

F=25/9.
55
=2.617

Example -1 Solution
The table value of F for df1=2, df2=9
and =5% level of significance is
4.26. Since calculated value of F is
less than its critical value , the null
hypothesis is accepted. Hence we
conclude that the prices of
commodity in three cities have no
significant difference

Example 2
Study investigated the perception of
corporate ethical values among
individuals specializing in marketing .
Using =0.05 and the following data
(higher scores indicate higher
ethical values), test for significance
in perception among three groups

Example 2 -Solution
Marketing
Manager

Marketing
research

Advertising

Example 2-Solution
Marketi
ng
researc
h

Marketi
ng
Manage
r

Adverti
sing

x1

x1

x2

x2

x3

x3

Total=

Total=

Total=

Total=

Total=

Total=

Example 2-Solution
Marketi
ng
researc
h

Marketi
ng
Manage
r

Adverti
sing

x1

x1

x2

x2

x3

x3

36

25

36

25

25

49

16

16

36

25

16

25

36

25

36

16

16

36

Total=3
0

Total=1
54

Total=2
7

Total=1
23

Total=3
6

Total=2
18

Example 2-Solution
There are r=3
treatments(samples)withn1=n2=n3
and n=18
T= X1 + X2+. +Xn
=30+27+36=93
CF=correction
factor=T/n=(93)/18=480.50
SSy=Total sum of squares
=(x1+x2+x3)-CF
=(154+123+218)- 480.50

Example -2 Solution
SSx=sum of squares between samples
(x1) + (x2) + (x3)
CF
=
n1
n2
n3
(30) + (27)
+ (36)
480.50
=
6
6
6
(900) +
(729) + (1296)
480.50 =
=
7
6
6
6
SSerror = SSy - SSx = 14.50-7=7.50

Example -2 Solution
Degrees of freedom df1=r-1=3-1=2;
df2=n-r=18-3=15
Thus MSx=SSx/df1=7/2=3.5
MSe=SSe/df2=7.50/15=0.5
ANOVA TABLE
Source Sum of
of
squares
variatio
n

Degree
of
freedo
m

Mean
Test
squares statisti
c

Betwee
n
sample
s

3.5

Within

7.5

15

0.5

F=3.5/0
.5
=7

Example -2 Solution
The table value of F for df1=2, df2=15
and =5% level of significance is
3.68. Since calculated value of F is
more than its critical value , the null
hypothesis is rejected. Hence we
conclude that there is significant
difference in ethical values among
individuals specializing in marketing

Example -3
As head of the department of a
consumers research organization ,
you have the responsibility for
testing and comparing lifetimes of
four brands of electric bulbs.
Suppose you test the life time of
three bulbs of each of the four
brands. The data shown below , each
entry representing the lifetime of an
electric bulb, measured in hundreds

Example -3
BRAND
A
20
19
21

BRAND
B
25
23
21

BRAND
C
24
20
22

BRAND
D
23
20
20

Can we infer that the mean lifetimes of

the four brands of electric bulbs are
equal ?

Example -3 Solution
Let us take the null hypothesis that
the mean lifetime of four brands of
electric bulbs are equal
SAMP
LE
A
x1
x1

x2

x2

x3

x3

x4

x4

20
19
21
Total
= 60

25
23
21
Total
= 69

625
529
441
Tota
l=

24
20
22
Total
=66

576
400
484
Tot
al =

23
20
20
Total
= 63

529
400
400
Tota
l=

400
361
441
Tota
l=

SAMP
LE B

SAMP
LE C

SAMP
LE D

Example 3-Solution
There are r=4
treatments(samples)with
n1=n2=n3 =n4=3 and n=12
T= X1 + X2+. +Xn =
60+69+66+63=258
CF= correction
factor=T/n=(258)/12=5547
SSy=Total sum of squares
=(x1+x2+x3+ x4)-CF
=(1202+1595+1460+1329)-

Example -3 Solution
SSx=sum of squares between samples
(x1) + (x2) + (x3) + (x4)
=
CF
n1
n2
n3
n4
(60) + (69)
+ (66)+
(63)
=
5547
3
3
3
3
=
(3600) + (4761) + (4356) + (3969)
5547= 15
3
3
3
3
SSerror = SSy- SSx = 39-15=24

Example -3 Solution
Degrees of freedom df1=r-1=4-1=3;
df2,= n-r = 12-4 = 8
Thus MSx=SSx/df1 = 15/3 = 5
MSe = SSe/df2 = 24/8 = 3
ANOVA TABLE
Source Sum of
of
squares
variatio
n

Degree
of
freedo
m

Mean
Test
squares statisti
c

Betwee
n
sample
s

15

Within

24

F=5/3
=1.66

Example -3 Solution
The table value of F for df1=3, df2=8
and =5% level of significance is
4.0662. Since calculated value of F is
less than its critical value , the null
hypothesis is accepted. Hence we
conclude that the difference in mean
life time of four brands of bulbs is not
significant and we infer that the
average lifetime of four bulbs is
equal

Thank You