Escolar Documentos
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By: Preethi.A.Prakash
Section G
INTRODUCTION
• “A Hypothesis test is a statistical test that is used to determine whether there is
enough evidence in a sample of data to infer that a certain condition is true for the
entire population.”
• Hypothesis Testing is basically an assumption that we make about the population
parameter.
For example, when your car breaks down you will make an educated guess that
there may be not enough petrol or may be some technical problem. Then you take
car to the nearest workshop to validate your guess/assumption/hypothesis.
Depending on the mechanic’s answer you will reject one hypothesis and accept
another hypothesis.
Here Null hypothesis is “not enough petrol”; Alternate hypothesis is may be some
technical problem.
Hypothesis testing was introduced by Ronald Fisher, Jerzy Neyman, Karl Pearson
and Pearson’s son, Egon Pearson.
A hypothesis test examines two opposing
hypotheses about a population: the null
hypothesis and the alternative hypothesis.
• Null hypothesis (H0):
The null hypothesis states that a
population parameter is equal to a value.
The null hypothesis is often an initial
claim that researchers specify using
previous research or knowledge.
A hypothesis based on years of business research in a particular area, then, helps you focus,
define and appropriately direct your research. You won’t go on a wild goose chase to prove
or disprove it. A hypothesis predicts the relationship between two variables. If you want to
study pricing and customer loyalty, you won’t waste your time and resources studying
tangential areas.
Marketing Support
One of the most important hypotheses to make in a business is the cost of acquiring a
customer. The viability as a business is founded on ensuring that the customers bring more
money than it costs to get them in the door. Hypothesizing this number informs not only the
pricing strategy but also the marketing efforts and the rest of overhead expenses. You can
also make predictions about the lifetime value of each customer to determine how much
marketing need to be done. Businesses frequently attempt to guesstimate how long a
customer will stick around and how much sales to each one will contribute to your profit.
In real life, hypotheses are honed and perfected over time through refining of basic
questions, assumptions and research methods. In addition, you may have more than one
hypothesis to explain the observations, such as why the product failed or why morale is
sinking in the office.
OTHER APPLICATIONS OF HYPOTHESIS
REFERENCES
• https://smallbusiness.chron.com/hypothesis-testing-used-business-22682.html
• https://www.referenceforbusiness.com/management/Gr-Int/Hypothesis-Testing.html
• http://timkastelle.org/blog/2016/06/the-magic-in-lean-startup-is-hypothesis-testing/
• https://www.statisticssolutions.com/hypothesis-testing/
• https://statistics.laerd.com/statistical-guides/hypothesis-testing.php
• https://medium.com/@thecodingcookie/hypothesis-testing-92b7270976de
• https://towardsdatascience.com/hypothesis-testing-in-real-life-47f42420b1f7