TEST OF HYPOTHESES: MEAN

A statistical hypothesis is a statement about the value of population parameter we are

interested in. For example, the population parameter could be a population mean µ or a
population proportion ρ . The hypothesized value of the population parameter is the center of
interest. The parameter we shall test in this chapter is typically a population mean. Stating the
null hypothesis requires a benchmark value for µ. This value does not come from a sample but
is based on past performance or maybe an industry standard (i.e., it comes from the
population in question).

The application will dictate which type of test we should construct. When testing a mean µ, we
choose between three tests:

Left-tailed test Two-tailed test Right-tailed test

H o : µ > µo or H o : µ = µo H o : µ < µo or
µ = µo
H 1: µ < µo H 1: µ ≠ µo H o : µ > µo

A one-tailed test is a directional test while a two-tailed is non-directional.

8.1 TESTING A MEAN: LARGE SAMPLES

The sample statistic used _ to estimate the mean µ is the sample mean x̅ . The sampling
distribution of x is approximately normal for large sample size (n > 30). Consequently whether
or not the population standard deviation σ is known, the normal distribution is used to test
hypotheses about the population mean when a sample size is large/

Test Statistic
In tests of hypotheses about the mean µ for large sample size, the random variable

z = x̅ - µ or z = x̅ - µ
σ / √n s/√ n

is called the test statistic. The test statistic can be defined as a rule or criterion used to make
the decision whether or not to reject the null hypothesis.

Large sample size: n > 30

Small sample size: n < 30

Example 1.

The Metro Baguio Fire Department aims to respond to fire calls 4 minutes or less, on the
average. Response times are normally distributed with a standard deviation of 1 minute. A
sample of 30 fire calls has a mean of 4 minutes and 30 seconds. Does this provide sufficient
evidence to show that the goal is not being me at a = 0.01?

Solution

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From the given information: µ =4 x̅ = 4.5 σ =1 n=30

We follow the 5-step process in testing hypotheses.

Step 1: State the 2 hypotheses

We use a right-tailed test. The null hypothesis is in conformance with the desired
performance.
H o : µ < 4 min
H 1: µ > 4 min

Step 2: Select the distribution and specify the a-value.

We use the z-distribution with a = 0.01 level of significance.

Step 3: Find the critical region.

Since this is a one-tailed test to the right, the critical or rejection region lies on the
right tail of the z-curve. The z-value leaving an area equal to 0.0100 (this is our a =
0.01) on the right is 2.326 (this is read from the table of z-values).

Critical value: z = 2.326

Critical region: z > 2.326

Rejection region

0.01 Z
µ=0 2.326

Decision rule: Reject H o if Z calc > 2.326

Otherwise, do not reject H o

Step 4: Calculate the test statistics.

Z calc = x̅ - µ = 4.5 - 4 = 2.739

σ / n 1 / √ 30

Step 5: Make a decision.

Since the calculated z=value = 2.739 is greater than the critical value of 2.326, it
means that the computed test statistic falls within the critical or rejection region. Thus,
the null hypothesis H o is rejected at a 0.01 level of significance. There is reason to
believe then that the average response time of 4 min or less is not valid. Hence, fire
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 fighters do not respond to fire calls in 4 minutes or less, on the average. It takes them
more than an average of 4 minutes to respond.

Example 2.

Based on SPDU’s records, the average length of time cadets in the past ran the stretch from
the parade ground to the checkpoint is 12.58 minutes. The unit’s head, Capt. Pauly wanted to
check if the mean length of time the present corps of cadets runs this distance is now different
from 12.58 minutes. A sample of 150 cadets had their running time recorded giving a mean of
12.44 minutes with a standard deviation of 2.65 minutes. Using the 5% level of significance,
can you conclude that the mean running time of all the cadets now is different from 12.58
minutes?

Solution

From the given information, µ = 12.58 x̅ = 12.44 s = 2.65 n = 150 We

are to test if the mean running time of the cadets now is different from that of the past. This is,
thus, a two-tailed test since the objective is to detect a deviation from the desire mean in either
direction

Following the 5-step procedure,

Step 1: State the two hypotheses

H o : µ = 12.58
H 1: µ ≠ 12.58
Step 2: Select the distribution and specify the level of significance.

We use the z-distribution (since n is large) with a = 0.05

Step 3: Determine the critical region.

Since this is a two-tailed test, we need a/2 on the two tails of the z-curve.

a/2 = 0.025 a/2 = 0.025

//// | /// z
-1.96 0 +1.96

Critical values: ⫨ 1.96

Decision rule: Reject H o if Z calc < -1.96 or if Z calc > +1.96.
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 Step 4: Calculate the test statistic.

Z calc = x̅ - µ = 12.44 - 15.58 = -0.647

s/√n 2.65 / √ 150
Step 5: Make a decision
The computed z-value does not fall in the critical region. Hence, we do not reject
the null hypothesis at a 0.05 level of significance. Accepting H o implies that the mean running
time of the present corps of cadets is not different from the mean running time of the present
corps of cadets is not different from the mean running time of cadets in the past.

TESTING A MEAN: SMALL SAMPLES

When the population standard deviation σ must be estimated from the sample and the sample
size n is small (i.e., n < 30), the test statistic to use is modified. We shall use the Student’s
T-distribution instead of the Z-distribution.

The T-distribution

The t-distribution is a specific type of bell-shaped distribution with a lower height and wider
spread than the standard normal curve. As the sample size becomes larger, the t-distribution
approaches the standard normal distribution. It has only one parameter called the degrees of
freedom (df). The mean is zero and the standard deviation is df/(df-2). The degrees of
freedom is defined as the number of observations that can be chose freely, i.e., df = n-1. The
value of the test statistic t is

t = x̅ - µ
s/√n
The T-curve

df = n -1

O t

Use Table VIII (The t-Distribution Table) at the Appendix to read critical values of t for the
specified number of degrees of freedom and areas in the right tail.

Example

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According to Pacman Power and Associates, the mean wait for an airport rental car in 2007
was 19 minutes, a random sample of 20 business travellers showed a mean wait of 15 minutes
with a standard deviation of 7 minutes. At a = 0.05, has the mean wait decreased?

Solution

Given = µo = 19 x = 15 s= 7 a = 0.05 n = 20

Step 1: State the two hypotheses

H o : µ = 19
H 1 : µ < 19

Step 2: Select the distribution and specify level of significance.

Use the t-distribution with df =n-1 = 20 – 1 =19 degrees of freedom because n is small and
σ is unknown.

Step 3: Determine the critical region.

df=19

0.05 t
-1.729 O
Critical value = -1.729
Decision rule: Reject H o if t calc < -1.729.

Step 4: Calculate the test statistic.

T calc = x̅ - µ = 15 - 19 = -2.55
s/√ n 7 / √ 20

Step 5: Make a decision

Since the computed test statistic falls in the critical region, we have to reject the null
hypothesis and accept the alternative hypothesis. Hence, the mean waiting time has
decreased. It takes less than 19 minutes on the average to wait for a rental car.

Summary

A test of hypothesis seeks to verify a claim or a conjecture about a population parameter. In

this chapter, we test hypotheses about the population mean. This seeks to determine if a
significant change has occurred with regard to the mean (µ).

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Two common statistical tests are the z-test and the t-test. The following rules apply when
choosing between the z-test or the t-test.
1. If σ is known, use the z-test. The variable must be normally distributed.
2. If σ unknown but n > 30, use the z-test and use S in place of σ ∈the formula .
3. If σ is unknown and n<30, use the t-test. The population must be approximately
normal.

The conclusion to the test should go beyond a mere statement of rejection or non-rejection of
the null hypothesis. It should make a clear statement of what is being affirmed, i.e., whether it
is the statement of the null hypothesis or the statement of the alternative hypothesis. Finally,
one should state the implication with regard to the conclusion’s impact on current procedures
and possibly on the policies of the organization.

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ACTIVITY Name: ________________________

1. The average number of visitors to the PMA museum was found to be 26 daily. After the
renovation has been made and with the transfer of the museum to its present site, the museum
officer, MAJ SIMON believes that the average number of visitors has increased. For 36
randomly chosen days, he monitored the number of people going to the museum. The sample
average is 28 with a standard deviation of 8. Is his allegation valid? Use a .05 level of
significance.
Solution:
a) H0: ____________
H1: ____________
b) Use the test statistic _____ with α = 5%.
c) Critical value = _______. Show figure below.

d) Computation:

e) Conclusion and interpretation:

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2. Typically, only very brave students are willing to speak out in a college classroom. Student
participation may be especially difficult if the individual is not from the urban area but is from a
province with a peculiar/ regional dialect orientation.. A numerical “speaking-up” scale with
possible values from 3 to 15 (A low value means that the student rarely speaks.) was
designed. For a random sample of 64 students from selected regions all over the country, the
sample mean and sample standard deviation were 8.75 and 2.57, respectively. Suppose that
the mean for the student population is 10.0, does it appear that students who don’t come from
the metropolis have lower speaking-up ability? Use a 1% level of significance.

Required: The 5-step test procedure.

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