OBJECTIVES

01 02 03
Illustrates Identify Formulate
(a) null hypothesis
Identifies the Formulates the
(b) alternative
parameter to appropriate
hypothesis
be tested null and
(c) types of errors
given a real- alternative
in hypothesis
life problem hypotheses on
testing
a population
(d) level of
mean
significance
Hypothesis Testing

Hypothesis Testing is a process

wherein we make decisions in evaluating
claims about the population based on the
characteristics of a sample taken from the
same population.
In Hypothesis Testing, we first
come up with a hypothesis, and later on, we
decide whether to reject or do not reject the
said hypothesis.
Hypothesis

A hypothesis is a proposed
explanation, assertion, or
assumption about a population
parameter or about the
distribution of a random variable.
6 Steps of Hypothesis Testing
1. State the null and
alternative hypotheses.
2. Select the level of
significance.
3. Statistical Tool (Z-test, T-
Test, CLT)
4. Formulate the decision
rule.
5. Compute the value of the
test statistics.
6. Decision Rule.
Illustrating
null and STEP 1: State
alternative the null and
hypothesis alternative
hypotheses
STEP 1: State the null and alternative hypotheses

➢ A null hypothesis is a statement about the value

of a population parameter formulated with the
hope of it being rejected. It is usually denoted by
Ho.

➢ If Ho is rejected, we will be led to accept an

alternative hypothesis, usually denoted by Ha.
A null hypothesis always
involves an equality An alternative
symbol. hypothesis contains the
inequality symbol “>, <“,
(Note: Some books allow or “≠”.
the null hypothesis to
contain the inequality
symbols “ ≥ or ≤”.)
Example 1: A common problem in many public schools is the large
class size. Suppose that the average number of students in a class in a
certain city was 65. We wish to know whether the classrooms built over
the years have succeeded to reduce this class size.

PARAMETER: the mean class size in public schools is 65

Ho : The mean class size in public schools is equal to 65.

Ho : μ ≥ 65 or Ho : μ = 65

Ha : The mean class size in public schools is less than 65.

Ha : μ < 65
Example 2: Suppose that the turnover rate of a 200-tablet bottle
of multivitamins follows the normal distribution with a mean of 6.0
and a standard deviation of 0.50. We would like to know if the mean
turnover has changed and is no longer 6.0.

PARAMETER: the mean turnover rate of a 200-tablet

bottle of multivitamins is 6.0

Ho : The mean turnover rate of a 200-tablet bottle of

multivitamins is equal to 6.0.
Ho : μ = 6.0
Ha : The mean turnover rate of a 200-tablet bottle of
multivitamins is no longer 6.0.
Ha : μ ≠ 6.0
Example 3: The school record claims that the mean score in Math of
the incoming Grade 11 students is 81. The teacher wishes to find out if the
claim is true. She tests if there is a significant difference between the batch
mean score and the mean score of students in her class.
PARAMETER: the mean score in Math of incoming Grade
11 students is 81

Ho: The mean score in Math of incoming Grade 11 students is 81.

Ho: μ = 81

Ha: The mean score of the incoming Grade 11 students is not 81.
Ha: μ ≠ 81
TYPES OF ERROR
Now, complete the statements that follow.
Analyze the possibilities of Donna’s conclusion. Identify if it is a Type I Error, Type
II Error, or a Correct Decision.
If Donna finds out that her null hypothesis is …

1. true and she fails to reject it, then she commits a ____________________.
Correct Decision

2. true and she rejects it, then she commits a _____________________.

Type I Error

Type II Error
3. false and she fails to reject it, then she commits a __________________.

Correct Decision
4. false and she rejects it, then she commits a _____________________.
Illustrating STEP 2:
Level of Select a
Significance Level of
Significance
 STEP 2: Select a Level of Significance

The level of significance (α) of a test is the probability of

rejecting the null hypothesis when it is true.

The value can range from 0 to 1 or 0% to 100%.

The smaller value of α, the surer we are that we are not

making an error if we end up rejecting Ho. Thus, a smaller
α leads to a higher amount of “evidence” needed before
we reject Ho in favor of Ha.
 There is no fixed value of α in any hypothesis test.
While α = 0.05 tends to be chosen as a default value, the
choice may differ depending on the application.

Usually, α is selected at 0.05 for

consumer research projects, 0.01 for quality
assurance, and 0.10 for political polling.

The usual significance level in research or

social science research is 5% (α = 0.05). It means
that there is a 5% chance of rejecting a true null
hypothesis and we are 95% confident that the result
is true.
 If the alternative hypothesis requires the two-tailed test (≠), the
alpha is divided by 2 later in determining the critical region.
Alpha One- tailed Two- tailed
0.1% 𝛂 = 𝟎. 𝟎𝟎𝟏 𝜶
= 𝟎. 𝟎𝟎𝟎𝟓
𝟐
1% 𝛂 = 𝟎. 𝟎𝟏 𝜶
= 𝟎. 𝟎𝟎𝟓
𝟐
5% 𝛂 = 𝟎. 𝟎𝟓 𝜶
= 𝟎. 𝟎𝟐𝟓
𝟐
10% 𝛂 = 𝟎. 𝟏 𝜶
= 𝟎. 𝟎𝟓
𝟐
INSTRUCTIONS:

1. FIND A PAIR.
2. Identify the Parameter
and formulate the null and
alternative hypothesis (in
words and in symbols) of
the given problems.
3. Write your answers on a
½ crosswise.
 PAIR ACTIVITY
1. The average height of senior high school students 16 years and
older is 158 cm for males. Is this claim true?

2. The average price per square meter of residential lot in an

exclusive subdivision is above Php 15,000. A buyer wants to test
the agent’s claim.
1. The average height of senior high school students 16 years and older is
158 cm for males. Is this claim true?

PARAMETER: the average height is 158 cm

Ho: The average height of SHS students is 158 cm.

Ho: μ = 158

Ha : The average height of SHS students is not 158 cm.

Ha: μ ≠ 158
2. The average price per square meter of residential lot in an exclusive
subdivision is above Php 15,000. A buyer wants to test the agent’s claim.

PARAMETER: the average price per square meter of residential

lot in an exclusive subdivision is above Php 15,000

Ho: The average price per square meter of residential lot in an

exclusive subdivision is Php 15,000.
Ho: μ ≤ Php 15,000 or Ho: μ = Php 15,000

Ha : The average price per square meter of residential lot

in an exclusive subdivision is above Php 15,000.
Ha: μ > Php 15,000
 Reflection #1
• Is there an
instance in your
life wherein you
made a wrong
decision? What is
it? What did you do
to correct it?
Q4 | QUIZ 1

Reflection #1
CONTINUATION ………

HYPOTHESIS
TESTING

Steps 3 to 6
 OBJECTIVES
01 02 03 04
Identify the Identify the Compute for Draws
appropriate appropriate the test conclusion about
form of test rejection region statistic the population
statistic. for a given level value. mean based on
of significance the test-statistic
and formulate a value and
decision rule. rejection region.
Step 3: Select the test statistic

Any function of the observed data whose numerical value

dictates whether the null hypothesis is accepted or rejected
is called a test statistic.
To identify the test statistic, you must consider whether the
population standard deviation/variance is known or
unknown.

If the population standard deviation is known, then the

mean has a normal distribution.
Step 3: Select the test statistic
z-test
-is used when the data are normally distributed,
-the population standard deviation (σ) is known
-the sample size is greater than or equal to 30 (𝒏 ≥ 𝟑𝟎)
FORMULA:
WHEREIN:
ഥ−µ
𝒙 z = z test
𝒛= 𝝈 𝑥ҧ = sample mean
µ = population mean
𝒏 𝝈 = population standard deviation
n = sample size
Step 3: Select the test statistic
t-test
-is used when the population is normal / approximately normal,
-the population standard deviation (σ) is unknown.

-the sample size is less than 30 (𝒏 < 𝟑𝟎)

FORMULA:
WHEREIN:
ഥ−µ
𝒙 t = t test
𝒕= 𝒔 𝑥ҧ = sample mean
µ = population mean
𝒏 𝒔 = sample standard deviation
n = sample size
Step 3: Select the test statistic
Central Limit Theorem (CLT)
- states that if you have a population with mean and standard deviation and
take sufficiently large random samples from the population, then the
distribution of the sample means will be approximately normally distributed.
- Hence, as the sample size gets larger, the data also approaches a normal
distribution.
- In this case, we can use the z –test formula, and if the population variance/
population standard deviation is unknown, we can use the sample variance
instead.
WHEREIN:
FORMULA:
ഥ−µ
𝒙 z = z test
𝒛= 𝝈 𝒙 = sample mean
µ = population mean
𝒏 𝒔 = sample standard deviation
n = sample size
Exercise #1: Identify the appropriate form of test statistic to be
used in the following situations.

1. A labor union president claims that the mean age of the

employees in a certain company is 38 with a standard deviation
of 6. A random sample of 30 employees from the same company
has a mean age of 36 and a standard deviation of 5. Test at 5%
significance level that the mean age of the employees is not 38.

Answer: sample size = 30

population variance is known,
hence, we can use the z- test.
Step 4: Formulate the decision rule.

A test hypothesis where the alternative hypothesis is

one-sided is called a one-tailed test. If the alternative hypothesis
is two-sided, then we call it a two-tailed test.

The set of values of the test statistic that result in the

rejection of the null hypothesis is called the critical region or the
region of rejection. The particular point in the critical region that
separates the rejection region with the acceptance region is called
the critical value.
REJECTION REGION
✓ The rejection region or (critical region) is the set of all
values of the test statistic that causes us to reject the
null hypothesis.
✓ The non- rejection region ( or acceptance region) is the
set of all values of the test statistic that causes us to fail
to reject the null hypothesis.
✓ The critical value is a point (boundary) on the test
distribution that is compared to the test statistic to
determine if the null hypothesis would be rejected.
 Step 4: Formulate the decision rule.
- Is the test
two-tailed or
one-tailed?
- Get the
critical values
from the test
statistic table
- Establish the
critical
regions
To get the critical values for the z-test use the z-table.
Exercise #2: Determine the critical values and formulate the decision rule..
1. A labor union president claims that the mean age of the employees in a
certain company is 38 with a standard deviation of 6. A random sample of
30 employees from the same company has a mean age of 36 and a
standard deviation of 5. Test at 5% significance level that the mean age of
the employees is not 38.

Ho: μ = 38 0.05
Ha: μ ≠ 38 two-tailed 𝑎= = 0.025
2
𝑎 = 5% 𝑜𝑟 0.05
𝟎. 𝟎𝟐𝟓 𝟎. 𝟎𝟐𝟓
Test Statistic: z-test

Critical values
(cv): ±1.96
 Critical Values (z-table)
Level of Test Types
Significance
One tailed
𝛂
Left – tailed Right - tailed Two - tailed

0.05 -1.645 1.645 ±1.96

0.01 -2.33 2.33 ±2.58

0.001 -3.09 3.09 ±3.30

Step 4: Formulate the decision rule.
1. A labor union president claims that the mean age of the employees in a
certain company is 38 with a standard deviation of 6. A random sample of
30 employees from the same company has a mean age of 36 and a standard
deviation of 5. Test at 5% significance level that the mean age of the
employees is not 38.
DECISION RULE: Reject 𝐻𝑜 if the computed test statistic ≤ negative critical
value or if the computed test statistic ≥ positive critical value. Otherwise, do
not reject(or accept) 𝐻𝑜 .
Critical values
(cv): ±1.96
DECISION RULE: Reject 𝐻0 if the value of the test
statistic is 𝑧 ≤ − 1.96 𝑜𝑟 𝑧 ≥1.96. Otherwise, do not
reject (or accept) 𝐻𝑜 .
Step 5: Compute the value of the test statistic.
1. A labor union president claims that the mean age of the employees
in a certain company is 38 with a standard deviation of 6. A random
sample of 30 employees from the same company has a mean age of 36
and a standard deviation of 5. Test at 5% significance level that the
mean age of the employees is not 38.
Parameters: Statistics:
µ = 38 𝝈=6 𝑥ҧ = 36 s = 5 n = 30

ഥ−µ
𝒙 𝟑𝟔 − 𝟑𝟖
𝒛= 𝝈 𝒛= = −𝟏. 𝟖𝟑
𝟔
𝒏 𝟑𝟎
Step 6: Make a decision.

➢ If the value of the test statistic falls within the critical region,
we reject Ho in favor of the alternative hypothesis.
Otherwise, we do not reject Ho.
➢ In the latter case, we sometimes say that there is insufficient
evidence to reject Ho.
Step 6: Make a decision.
1. A labor union president claims that the mean age of the employees in a
certain company is 38 with a standard deviation of 6. A random sample of
30 employees from the same company has a mean age of 36 and a standard
deviation of 5. Test at 5% significance level that the mean age of the
employees is not 38.

The rejection region is: z ≤ −1. 96 or z ≥ 1. 96

The test statistic value is: z = -1.83
Decision: Since −1.83 > −1.96, we do not reject (accept) the
null hypothesis and reject the alternative hypothesis.
Conclusion: The mean age of the employees in a certain company is
38.
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
1. A teacher wants to find out if his teaching strategy is effective. A sample
of 25 students took a 100 points examination and the average is 80 with a
standard deviation of 7. Test at 10% significance level that the average of
the students greater than 75 which is the standard passing score.

Step 1. State the null and alternative hypothesis.

Ho: μ = 75
Ha: μ > 75
Step 2. Select the level of significance. 𝒂 = 𝟏𝟎% 𝒐𝒓 𝟎. 𝟏𝟎

Step 3. Select the appropriate form of test

statistic.
Test Statistic: t-test
Step 4. Formulate the decision rule.

Ha: μ > 75 – one-tailed

𝑎 = 10% 𝑜𝑟 0.10
Since the alternative hypothesis
DECISION RULE: Reject 𝐻0 if the value of
is one-tailed and indicates the test statistic t ≥1.318. Otherwise, do not
greater than, the rejection region reject (or accept) 𝐻𝑜 .
is located on the right side. The
significance level stated is 10%.
𝑡𝛼 = 𝑡0.10 𝑡 ≥ 𝑡𝛼

Degrees of freedom, df = n -
1, thus df = 25 – 1 = 24. We
will refer to 𝛼 = 0.10 with
respect to one tail.
Step 5. Compute the test statistic.

1. A teacher wants to find out if his teaching strategy is effective. A sample

of 25 students took a 100 points examination and the average is 80 with a
standard deviation of 7. Test at 10% significance level that the average of
the students greater than 75 which is the standard passing score.

Parameters: Statistics:
µ = 75 𝑥ҧ = 80 s=7 n = 25

ഥ−µ
𝒙 𝟖𝟎 − 𝟕𝟓
𝒕= 𝒔 𝒕= = 𝟑. 𝟓𝟕
𝟕
𝒏 𝟐𝟓
Step 6. Make a decision.

1. A teacher wants to find out if his teaching strategy is effective. A sample

of 25 students took a 100 points examination and the average is 80 with a
standard deviation of 7. Test at 10% significance level that the average of
the students greater than 75 which is the standard passing score.

The rejection region is: t ≥ 1. 318

The test statistic value is: t = 3.57

Decision: Since 3.57 > 1.318, we reject the null hypothesis

and do not reject (accept) the alternative hypothesis.
Conclusion: The average of the students who took the examination is
greater than 75. The teaching strategy that the teacher employed is
effective.
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
2. The mean time a customer waits in line before checking in at a grocery
chain is less than 10 minutes. To verify the performance of the store, the
obtaining mean time of 25 customers is 9.5 minutes with a standard
deviation of 1.6 minutes. Use these data to test the null hypothesis that the
mean time is 10 minutes, at a 0.01 level of significance.
Step 1. State the null and alternative hypothesis.

Ho: The mean time a customer Ho: The mean time a customer
waits in line before checking waits in line before checking
in at grocery chain is equal to in at grocery chain is less than
10 minutes. 10 minutes.
Ho: μ = 10 Ha: μ < 10
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
2. The mean time a customer waits in line before checking in at a grocery
chain is less than 10 minutes. To verify the performance of the store, the
obtaining mean time of 25 customers is 9.5 minutes with a standard
deviation of 1.6 minutes. Use these data to test the null hypothesis that the
mean time is 10 minutes, at a 0.01 level of significance.

Step 2. Select the level of significance. 𝒂 = 0.01 or 1%

Step 3. Select the appropriate form of

test statistic.
Given: µ = 𝟏𝟎 ഥ
𝒙 = 𝟗. 𝟓
𝒔 = 𝟏. 𝟔 𝒏 = 𝟐𝟓
Test Statistic: t-test
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
2. The mean time a customer waits in line before checking in at a grocery
chain is less than 10 minutes. To verify the performance of the store, the
obtaining mean time of 25 customers is 9.5 minutes with a standard
deviation of 1.6 minutes. Use these data to test the null hypothesis that the
mean time is 10 minutes, at a 0.01 level of significance.
Step 4. Formulate the decision rule.

Ha: μ < 10 One-tailed Critical Value (cv): - 2.492

𝑎 = 1% 𝑜𝑟 0.01 Rejection Region: t ≤ -2.492
Decision Rule: Reject 𝐻0 if the value
Degrees of Freedom (df) = n - 1
of the test statistic t ≤ - 2.492 .
df = 25-1
Otherwise, do not reject (or accept)
df = 24
𝐻𝑜 .
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
2. The mean time a customer waits in line before checking in at a grocery
chain is less than 10 minutes. To verify the performance of the store, the
obtaining mean time of 25 customers is 9.5 minutes with a standard
deviation of 1.6 minutes. Use these data to test the null hypothesis that the
mean time is 10 minutes, at a 0.01 level of significance.
Step 5. Compute the test statistic. ഥ−µ
𝒙
𝒕= 𝒔
Given: µ = 𝟏𝟎 ഥ
𝒙 = 𝟗. 𝟓
𝒏
𝒔 = 𝟏. 𝟔 𝒏 = 𝟐𝟓
𝟗. 𝟓 − 𝟏𝟎
Test Statistic: t-test 𝒕=
𝟏. 𝟔
= −𝟏. 𝟓𝟔𝟐𝟓
𝟐𝟓
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
2. The mean time a customer waits in line before checking in at a grocery
chain is less than 10 minutes. To verify the performance of the store, the
obtaining mean time of 25 customers is 9.5 minutes with a standard
deviation of 1.6 minutes. Use these data to test the null hypothesis that the
mean time is 10 minutes, at a 0.01 level of significance.
Step 6. Make a decision.

The Rejection Region: t ≤ - 2.492 Conclusion: The mean time

The test statistic value is: t = -1.5625 a customer waits in line
before checking in at
Decision: Since -1.5625 > - 2.492, grocery chain is 10 minutes.
we do not reject (accept) the null
hypothesis and reject the
alternative hypothesis.
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
3. A banana company claims that the mean weight of its banana is 150
grams with a standard deviation of 18 grams. Data generated from a
sample of 49 bananas randomly selected indicated a mean weight of 153.5
grams per banana. Is there sufficient evidence to reject the company's
claim? Use 𝒂 =0.05.
Step 1. State the null and alternative hypothesis.

Ho: The mean weight of the Ho: The mean weight of the
banana is 150 grams. banana is not 150 grams.
Ho: μ = 150 Ha: μ ≠ 150
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
3. A banana company claims that the mean weight of its banana is 150
grams with a standard deviation of 18 grams. Data generated from a
sample of 49 bananas randomly selected indicated a mean weight of 153.5
grams per banana. Is there sufficient evidence to reject the company's
claim? Use 𝒂 =0.05.

Step 2. Select the level of significance. 𝒂 = 0.05 or 5%

Step 3. Select the appropriate form of

test statistic.
Given: µ = 𝟏𝟓𝟎 ഥ
𝒙 = 𝟏𝟓𝟑. 𝟓
𝝈 = 𝟏𝟖 𝒏 = 𝟒𝟗
Test Statistic: z-test
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
3. A banana company claims that the mean weight of its banana is 150
grams with a standard deviation of 18 grams. Data generated from a
sample of 49 bananas randomly selected indicated a mean weight of 153.5
grams per banana. Is there sufficient evidence to reject the company's
claim? Use 𝒂 =0.05.
Step 4. Formulate the decision rule.

Ha: μ ≠ 150 Two-tailed Rejection Region: 𝑧 ≤ − 1.96 𝑜𝑟 𝑧 ≥1.96

0.05 Decision Rule: Reject 𝐻0 if the
𝑎= = 0.025
2 value of the test statistic z ≤ -1.96
Critical Value (cv): ±1.96 or z ≥1.96 . Otherwise, do not
reject (or accept) 𝐻𝑜 .
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
3. A banana company claims that the mean weight of its banana is 150
grams with a standard deviation of 18 grams. Data generated from a
sample of 49 bananas randomly selected indicated a mean weight of 153.5
grams per banana. Is there sufficient evidence to reject the company's
claim? Use 𝒂 =0.05.
Step 5. Compute the test statistic. ഥ−µ
𝒙
𝒛= 𝝈
Given: µ = 𝟏𝟓𝟎 ഥ
𝒙 = 𝟏𝟓𝟑. 𝟓 𝒏
𝝈 = 𝟏𝟖 𝒏 = 𝟒𝟗
𝟏𝟓𝟑. 𝟓 − 𝟏𝟓𝟎
Test Statistic: z-test 𝒛=
𝟏𝟖
= 𝟏. 𝟑𝟔
𝟒𝟗
LET’S TRY THIS!
Instruction: Perform the six steps of hypothesis testing given the problem below.
3. A banana company claims that the mean weight of its banana is 150
grams with a standard deviation of 18 grams. Data generated from a
sample of 49 bananas randomly selected indicated a mean weight of 153.5
grams per banana. Is there sufficient evidence to reject the company's
claim? Use 𝒂 =0.05.
Step 6. Make a decision.

The Rejection Region: 𝑧 ≤ − 1.96 𝑜𝑟 𝑧 ≥1.96 Conclusion: The mean

The test statistic value is: z = 1.36 weight of the banana is 150
grams. There is no sufficient
Decision: Since 1.36 < 1.96, we do evidence to reject the
not reject the null hypothesis company’s claim.
(accept) and reject the alternative
hypothesis.
 Reflection #2
In what aspect of
your life can you
associate
the concept of
critical values and
rejection region?
Explain your answer.
ANY QUESTIONS?
 Q4 |
WORKSHEET 1

Reflection #2