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F-Test - Definition, Statistics, Calculation, Interpretation, Example

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F-Test - Definition, Statistics, Calculation, Interpretation, Example

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vinay kumar
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© © All Rights Reserved
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Download as PDF, TXT or read online on Scribd
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8/10/23, 11:00 AM F-Test - Definition, Statistics, Calculation, Interpretation, Example 8/10/23, 11:00 AM F-Test - Definition, Statistics, Calculation, Interpretation,

Test - Definition, Statistics, Calculation, Interpretation, Example

The F-Test helps to determine the overall significance of the regression. It is


 
useful in various situations, such as when a quality controller wants to
determine whether the product’s quality is deteriorating over time. In
Home » Statistics Guides » F-Test
addition, it might be useful for an economist to determine whether income
variability varies between two populations.
F-Test
Article by Reviewed by
Table of contents
Dheeraj Vaidya Dheeraj Vaidya, CFA, FRM
F-Test Definition
F-Test Explained
F-Test Definition Formula
F-Test in statistics is a hypothesis-testing procedure that considers two Calculation Example
variances from two samples. The F-Test is used when the difference
Interpretation
between two variances needs to be significantly assessed, i.e., when
determining whether or not two samples can be taken as representative of Frequently Asked Questions (FAQs)
the normal population with the same variance. Recommended Article

Key Takeaways

The F-test is a statistical test that evaluates if the variances of the


two normal populations are equal.

One can deem the variance ratio of the test insignificant if F OR =


F0.5, and one can assume that the values will be from the same
group or groups with similar variances.

The null hypothesis is rejected, and the variance ratio is considered


significant if F> OR = F0.5.

The F-test vs. t-test: The t-test and the F-test are two separate tests.
The T-test compares two populations’ means, whereas the other
compares two populations’ variances.
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F-Test in Statistics Explained


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8/10/23, 11:00 AM F-Test - Definition, Statistics, Calculation, Interpretation, Example 8/10/23, 11:00 AM F-Test - Definition, Statistics, Calculation, Interpretation, Example

F-test in statistics helps to decide whether two populations’ variances are 3. To compute the variance ratio, use the formula F = larger estimate divided
 
equal. This is the variance ratio test because it calculates the ratio of by a smaller estimate of variance. Regardless of whether S12 or S22, the
variances. The goal of the test is to determine whether the variance in two numerator will always be the larger value.
populations is equal. It was propounded by British polymath R.A. Fisher and
4. When calculating degrees of freedom, the larger the sample’s variance is
named to honor him. G.W. Snedecor later developed the test.
V1; the smaller variance is V2.
The following conditions are critical for using the F-test to compare the
5. Table value of F: the critical value of F is available from the “F-Table” (F-
variances of two populations:
test table) at the determined significance level.
1. Normality: the populations must have a normal distribution.

2. Independent and random selection of sample items: the selection of


the samples’ components should be independent and random.

3. More than unity: The variance ratio must be one or larger than one; it
cannot be less than one. When dividing variance estimates, smaller
estimates divide the larger estimates of variances.

4. The additive property states that the total of different variance


components will equal the total variance, i.e., the total variance is the
sum of the variance between samples and the variance within samples.
6. Analysis: This involves the comparison of the computed value and the
Formula tabulated value. For various levels of significance, there are several F Tables
(F-test tables).
1. Sample variances: The formula for calculating sample variances is as
follows (an online F-test calculator can make it easier): (a) The variance ratio is insignificant if F < OR = F0.5. We can assume that
the values are from the same group or groups with similar variances.

(b) The null hypothesis is rejected, and the variance ratio is considered
significant if F> OR = F0.5.

Calculation Example
2. Null hypothesis: After the formation of the test, the null hypothesis are
either Consider the example of the population in a village:

a) Two samples were from the same group or Village A B

(b) The population’s variances concerning both samples are equal. Sample size 10 12

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8/10/23, 11:00 AM F-Test - Definition, Statistics, Calculation, Interpretation, Example

Mean monthly income 150 140



Sample variance 92 110

Testing the equality of sample variances with a significance level of 5% with


the above-given date.

Variance sample for S12 (sample1) =

And

Variance sample for S22(sample 2) =

F= S12/ S22 = 10.22/10=1.022

The critical value for v1 (10-1) = 9 and v2 (12-1) =11 and the table value of F
at 5% significance level = 2.90. An online f-test calculator can help you in
making the calculations easier.

Interpretation
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