Scribd
Upload
55 views23 pages

Analysis of Variance (Anova) : Week 8

The document discusses the analysis of variance (ANOVA) technique for comparing population means across multiple groups. It provides an example of using ANOVA to test if there are differences in driving times between two routes, finding evidence that the variation between the routes is different. The document also covers the assumptions of ANOVA, how to conduct an ANOVA test, and provides an example comparing satisfaction scores across four airlines.

Uploaded by

Karazay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
55 views23 pages

Analysis of Variance (Anova) : Week 8

The document discusses the analysis of variance (ANOVA) technique for comparing population means across multiple groups. It provides an example of using ANOVA to test if there are differences in driving times between two routes, finding evidence that the variation between the routes is different. The document also covers the assumptions of ANOVA, how to conduct an ANOVA test, and provides an example comparing satisfaction scores across four airlines.

Uploaded by

Karazay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 23

ANALYSIS OF

VARIANCE (ANOVA)
Week 8
The F Distribution
1. There is a family of F distribution
2. The F distribution is continuous
3. The F statistic cannot be negative
4. The F distribution is positively skewed
5. The F distribution is asymptomatic
*Testing a Hypothesis of Equal Population Variances
Example 1:
Sean Lammers wants to study the time it takes to drive to the airport using each route
and then compare the results. He collected the following sample data, which is
reported in minutes. Using the .10 significance level, is there a difference in the
variation in the driving times for the two routes?
U.S Route 25 Interstate 75 Numerator
52 59 s2 of U.S Route 25 = 8.9947
67 60
s2 of Interstate 75 = 4.3753
Denominator
56 61
45 51
70 56
54 63
64 57
65
*Testing a Hypothesis of Equal Population Variances

Step 1: 𝐻0 : 𝜎12 = 𝜎22


𝐻1 : 𝜎12 ≠ 𝜎22
Step 2: α = 0.1
Step 3: Test statistic used is F distribution because we are examining σ2
Step 4: Two tailed test, 0.1/2=0.05
n1 = 7 – 1 = 6

n2 = 8 – 1 = 7 Critical value
*Testing a Hypothesis of Equal Population Variances
Step 5:
𝑠12 8.99472
𝐹= 2= 2
= 4. 23
𝑠2 4.3753
Because 4.23 is larger than 3.87, reject H0

Step 6: There is some evidence that there is a difference in the variation in the time to
travel the two routes.
END
ANOVA
ANOVA Assumptions
o The ANOVA to test the equality of three or more μ requires that three assumptions
are true:
1. The populations follow the normal distribution
2. The populations have equal σ
3. The populations are independent.
o When these conditions are met, F is used as the distribution of the test statistic
o Why can’t we just use the test of differences in population means discussed in the
previous chapter? We could compare the population means two at a time.
➢ The ANOVA technique allows us to compare population means simultaneously at
a selected significance level and avoids the buildup of Type I error
The ANOVA Test
A group of four carriers hired Brunner Marketing Research Inc. to survey passengers
regarding their level of satisfaction with a recent flight. Twenty-five questions offered
a range of possible answers: excellent, good, fair, or poor. A response of excellent was
given a score of 4, good a 3, fair a 2, and poor a 1. These responses were then totaled,
so the total score was an indication of the satisfaction with the flight. The greater the
score, the higher the level of satisfaction with the service. The highest possible score
was 100. Brunner randomly selected and surveyed passengers from the four airlines.
Below is the sample information. Is there a difference in the mean satisfaction level
among the four airlines? Use the 0.01 significance level.
The ANOVA Test
Step 1 𝐻0 : 𝜇𝑁 = 𝜇𝑊 = 𝜇𝑃 = 𝜇𝐵
𝐻1 : 𝑇ℎ𝑒 𝑚𝑒𝑎𝑛 𝑠𝑐𝑜𝑟𝑒𝑠 𝑎𝑟𝑒 𝑛𝑜𝑡 𝑎𝑙𝑙 𝑒𝑞𝑢𝑎𝑙
Step 2: α = 0.01

Step 3: The test statistics follows the F distribution


Step 4:
Numerator: k – 1 = 3
Denominator: n – k = 22 – 4 =18
Critical value = 5.09
The ANOVA Test
Step 5:
94 + 90 + ⋯ + 75 + 68 + ⋯ + 70 + 73 + ⋯ + 68 + 70 + ⋯ + 65
𝑥𝐺 = = 75.64
22

𝑆𝑆 𝑡𝑜𝑡𝑎𝑙 = ෍ 𝑥 − 𝑥𝐺 2 = 94 − 75.64 2 + 90 − 75.64 2 + ⋯ + 65 − 74.64 2 = 1485.1

94 + ⋯ + 80
𝑥𝑁 = = 87.25 𝑥𝑊 = 78.20 𝑥𝑃 = 72.86 𝑥𝐵 = 69
4
2 2 2 2 2
𝑆𝑆𝐸 = ෍ 𝑥 − 𝑥𝐶 = 94 − 87.25 + ⋯ + 75 − 78.20 + ⋯ + 70 − 72.86 + ⋯ + 65 − 69 = 594.41

𝑆𝑆𝑇 = 𝑆𝑆 𝑡𝑜𝑡𝑎𝑙 − 𝑆𝑆𝐸 = 1485.1 − 594.41 = 890.69


The ANOVA Test
Step 5:

Since 8.99 > 5.09, reject H0

Step 6: There is evidence that the population means are not all equal.
Exercise
References
Lind, D.A., Marchal, W.G. & Wathen, S.A. (2015) Statistical Techniques in Business and
Economics, 17th Edition. McGraw-Hill

You might also like