STATISTICAL
INFERENCE
ENGINEERING DATA
ANALYSIS
MA 89
A Presentation B2Euljun Salarda
by Engr.
Statistical inference using
hypothesis-testing methods
• Statistical inference is the process of generating conclusions
or generalizations about certain characteristics of the
population on the basis of information obtained from a
sample.
• Statistical inference can be conducted in two ways: by interval
estimation of parameters and by testing the statistical
hypothesis on parameters. These are actually reverse
processes much like addition and subtraction or
multiplication and division in arithmetic or differentiation and
integration in calculus.
• The following discussion is limited to the hypothesis-testing
procedures applied to a selected batch of parameters such as
(1) the population mean, µ, and (2) the population
proportion, π, for one-sample tests of significance; (3) the
difference of two population means, µ 1 - µ 2 , for
independent samples and (4) the difference of two
population proportions, π1 - π2 , for two-sample tests.
A statistical hypothesis is a statement
about the numerical value of a population
parameter. There are six steps involved in
the hypothesis-testing procedure, as
shown in Figure 1.
Step
Step 1.
1. State
State the
the null
null
hypothesis,
hypothesis, Ho.
Ho. The
Thenull
null
hypothesis
hypothesisisisusually
usuallythe
the
hypothesis
hypothesisthatthatthe
theresearcher
researcher
wants
wantsto togather
gatherevidence
evidence
against
againstororisisthe
thehypothesis
hypothesisto to
be
betested
tested..The
TheHoHocarries
carriesthe
the
symbol
symbol==;;or orat
atcertain
certaintimes
times
bear
beartwo
twosymbols
symbolssuchsuchasas≥≥or
or
≤,
≤,thus,
thus,making
makingHo Hocomposite
composite
in
innature.
nature.
Step
Step 2.2. State
State the the alternative
alternative
hypothesis,
hypothesis, Ha. Ha. The The alternative
alternative
hypothesis
hypothesis isis usually
usually the
the
hypothesis
hypothesis for for which which the the
researcher
researcher wants wants to to gather
gather
supporting
supporting evidence
evidence by by way
way of of
observation
observationthat thatcould
couldbe beobtained
obtained
from
from his
his sampling
sampling experiment.
experiment. The The
alternative
alternative hypothesis
hypothesis isis the the
opposite
oppositeof ofthe
thenullnullhypothesis.
[Link]
aa two
two tailed
tailed test,
test, the
the symbol
symbol used
used
in
in the
the Ha
Ha statement
statement isis ≠≠ and and for
for aa
one-tailed
one-tailed test,
test, itit isis either
either >> or
or <.
<.
The
The alternative
alternative hypothesis
hypothesis carries
carries
only
onlyone
onesymbol
symbolat atallalltimes.
times.
07/02/2025
Step
Step 3: 3: Specify
Specify the
the level
level
of
of significance,
significance, α. α. The
The
significance
significance level,
level, denoted
denoted
by
by α,
α, isis the
the probability
probability of of
committing
committing aa Type Type II Error:
Error:
that
that of
of rejecting
rejecting aa null
null
hypothesis
hypothesis which which is,
is, in
in
reality,
reality, true.
true.
Step
Step 4:
4: Detemine
Detemine thethe
critical
critical region
region and
and the
the
appropriate
appropriate test
test statistic.
statistic.
The
Thecritical
criticalregion
regionisisthe
therejection
rejectionarea areaforfor
the
thenull
nullhypothesis.
[Link] Therejection
rejectionregionregion
covers
coversaatotal
totalarea
areaequal
equalto toαα. .The
The
appropriate
appropriatetestteststatistic
statisticisisthe
the
standardized
standardizedscorescoreofofthe
thesample
samplestatistic
statistic
whose
whosesingle
singlecritical
criticalvalue
valuefor foraaone-tailed
one-tailed
test
testof
ofsignificance
significanceor ortwo
twocritical
criticalvalues
values
for
foraatwo-tailed
two-tailedtesttestdetermines
determinesthe the
boundary/boundaries
boundary/boundariesbetween betweenthe the
acceptance
acceptanceand andrejection
rejectionregions
regionsfor forHoHo. .
The
Thetest
teststatistic
statisticcould
couldbebeZZ, ,t,t, , ,FF, ,etc.
etc.
depending
dependingon onthe
theappropriate
appropriatesampling
sampling
distribution
distributionof ofthe
thesample
samplestatistic
statisticto tobe
be
used.
[Link]
Thecritical
criticalvalue
valueofofthethetest
teststatistic
statistic
can
canbeberead
readfrom
fromthethestatistical
statisticaltables
tables
Step
Step 5:
5: Compute
Compute the the
equivalent
equivalent test
test statistic
statistic of
of
the
the observed
observed valuevalue ofof the
the
parameter.
parameter. TheThe computed
computed
value
value of
of the
the test
test statistic
statistic
can
can be
be generated
generated fromfrom an an
appropriate
appropriate formula
formula as as
determined
determined fromfrom thethe
given
given conditions
conditions of of the
the
statistical
statistical experiment.
experiment.
Step
Step 6.
6. Make
Make your your
decision
decision either
either REJECT
REJECT Ho Ho
or
or ACCEPT
ACCEPT Ho. Ho. TheThe null
null
hypothesis,
hypothesis, Ho Ho ,, will
will be
be
rejected
rejected ifif the
the computed
computed
value
value of
of the
the test
test statistic
statistic
in
in STEP
STEP 55 falls
falls within
within thethe
rejection
rejection region
region or or
accepted,
accepted, ifif itit falls
falls within
within
the
the acceptance
acceptance region region forfor
Ho
Ho ..
The following table will
summarize the symbols and
terminologies to be used:
• A. HYPOTHESIS –TESTING for µ :
Case 1. If the population standard deviation, σ , is known, use the
standardized test statistic Z.
• Illustrative Problem The Supreme Restaurant chain claims that the
waiting time of customers for service is normally distributed with a
mean of 3.5 minutes and a standard deviation of 1.3 minutes. The
quality – assurance department found in a sample of 40 customers at
the hamburger branch in Malate that the mean waiting time was 4.8
minutes. Test the claim on the mean waiting time at the 0.05
significance level.
• Given: μ0 = 3.5 minutes, σ = 1.3 minutes, n = 40, x̄ = 4.8 minutes,
α = 0.05
• Case 2. If the sample standard deviation, s , is known, or could be
known, use the test statistic t.
• Illustrative Problem Farm and power equipment dealers’ are typically
dependent on a primary supplier organization for many of their business
needs. These suppliers often demand control over many of the dealers’
decisions. To determine the degree to which dealers are dependent on
suppliers, a survey of 12 farm and power equipment dealers was
conducted. The study revealed the following data on the total number of
suppliers engaged by the dealers: 4, 3, 2, 2, 3, 5, 2, 3, 3, 4, 4, 6.
• Test the hypothesis that the true mean number of suppliers engaged by
farm and power equipment dealers exceeds 3, using a 0.01 significance
level.
• Given: μ0 = 3 suppliers, n = 12, x̄ = 3.4167suppliers, s = 1.2401 suppliers
• The and s values are calculator-generated. The existence of the
word “exceeds” referring to µ = 3 suggests a one-tailed or directional
test.
• B. HYPOTHESIS –TESTING on the difference of two population
means, µ1 - µ2, for independent samples:
• Case 1. If the population standard deviation, σ1 and σ 2 are known,
use the z.
• Illustrative Problem The personnel department of Company A wishes
to compare the efficiency of workers who are native-born with those
who are foreign-born. Company records show that the standard
deviations for outputs of native-born and foreign-born workers are 8
and 10, respectively. The company takes a sample of 32 native-born
workers with a mean output of 50 units per worker, and a sample of
38 foreign-born workers with a mean output of 40 units per worker.
Test to determine which group is more productive, at α = 0.01
• Case 2 . If the sample standard deviations, S1 and S2 are known and if the
samples come from populations having equal standard deviations or variances,
use t .
• Illustrative Problem As a result of recent advances in educational
telecommunications, many colleges and universities are utilizing instruction by
interactive television for “distance” education. For example, each semester, Ball
State University televises six graduate business courses to students at remote off-
campus sites (Journal of Education for Business, Jan/Feb. 1991). To compare the
performance of the off-campus MBA students at Ball State (who take the
televised classes) to the on-campus MBA students (who have a “live” professor),
a test devised by the Assembly of Collegiate Schools of Business (AACSB) was
administered to a sample of both groups of students. (The test included seven
exams covering accounting, business strategy, finance, human resources,
marketing, management information systems, and production and operations
management.) The AACSB test scores (50 points maximum) are summarized in
the table. Based on these results, the researchers report that “there was no
significant difference between the two groups of students.”