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Confidence Interval For Population Variance

This document discusses hypothesis testing and provides examples of how to conduct hypothesis tests for population means and proportions. It defines key concepts like the null and alternative hypotheses, test statistics, decision rules, types of errors, p-values, and outlines the steps for performing a hypothesis test. An example is provided to demonstrate a hypothesis test comparing a sample mean to a manufacturer's claim about the population mean weekly income of car owners.

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Nicholas Boampong
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76 views

Confidence Interval For Population Variance

This document discusses hypothesis testing and provides examples of how to conduct hypothesis tests for population means and proportions. It defines key concepts like the null and alternative hypotheses, test statistics, decision rules, types of errors, p-values, and outlines the steps for performing a hypothesis test. An example is provided to demonstrate a hypothesis test comparing a sample mean to a manufacturer's claim about the population mean weekly income of car owners.

Uploaded by

Nicholas Boampong
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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STATISTICS

VINCENT K. DEDU
DEPT. OF STATISTICS AND ACTUARIAL
SCIENCE, KNUST.
CONFIDENCE INTERVAL FOR MEAN
•It  exists for two cases:
• Large sample size
• Small sample size

‘n’ large
I. Whenn is large nis known, the C.I for
•  
With maximum error

•  

From which we obtain the


sample size n
n=
n-small
•ii.  When n is small ,then the sampling
distribution becomes the t distribution and the
confidence interval becomes

,n-1
••  
Where ,n-1
is the critical value obtained from the t
distribution table with n-1 degrees of
freedom.
Cont’d

7
•Example
 
• = 42, n= 25 and S=6. Find 95% C.I for
Sleeping Time

• Ten randomly selected people were


asked how long they slept at night. The
mean time was 7.1 hours, and the
standard deviation was 0.78 hour. Find
the 95% confidence interval of the mean
time.

9
FOR PROPORTION
•  

^𝑝 (1− ^𝑝 )
^𝑝 ± 𝑍 𝛼
2 √ 𝑛
CONFIDENCE INTERVAL FOR
POPULATION VARIANCE
CHI-SQUARE DISTRIBUTION
 
χ2 =

n = Sample Size
PROPERTIES OF THE CHI-SQUARE DISTRIBUTION

χ2 - Distribution

1. Not Symmetrical
2. Values are non-negative
3. As the degrees of freedom goes up, the
distribution becomes more symmetrical but
never gets symmetrical
Cont’d

13
FINDING THE CONFIDENCE INTERVAL
•n=  12, 0.05 = .025
= .025

χL2 χ R2
3.816 21.92

1-.025 =.975
Cont’d

15
CONT’D
•   CONFIDENCE INTERVAL FOR VARIANCE
CONFIDENCE INTERVAL FOR STANDARD
DEVIATION
•  
EXAMPLE 1
•n=7,
  315.6
Find a 95% confidence interval for

SOLUTION
C.I. = []
C.I. = [131.04 ; 1530.66]
EXAMPLE 2
•A sample
  of 7 boxes of a certain type of cereal
with a nominal weight of 750grams had the
following weights;

775, 780, 781, 795, 803, 810, 823

Find a 95% confidence interval for


SOLUTION
•n=  7

C.I = []

C.I =[131.042 ; 1530.662]


EXAMPLE 3
•n =  8, 5.3
Find a 95% confidence interval for

Solution
C.I. =[]
C.I. = [2.32; 21.95]
Hypothesis Testing
Introduction:
In some practical problems of statistical inference we
may be required to take decision concerning the
parameters of the population instead of finding
estimates for them. The following are some situations
requiring such decisions:

(a) A health personnel may claim that a drug is


effective in 90% cases it is administered.

(b)A mean life span of a type of an electric bulb is at


least 8,000 hours.
• (c) An accused, in a criminal trial, is always
assumed to be innocent until proven otherwise.

• (d) An educationist may claim that two methods


of teaching are equally effective.

• (e) An educational programme will result in


improved communication between parents and
children.
(f) A medical researcher may have a
hypothesis that a new drug is more
effective than another one in curing a
disease.
• The above statements can be subjected to
statistical verification using sample
observations.

• Thus by means of hypothesis testing we are


able to determine whether or not the
statements are consistent with available data
or evidence.
(a)Definitions:

(i) Hypothesis is a statement, assertion or


conjecture about the nature of one or more
situations ( or populations) to be studied.

(ii) Hypothesis Testing is a statistical procedure


that uses a random sample data to determine
whether the statement about a population
should be rejected or not. Hypothesis testing
involving population parameters are called
Parametric or Classical tests
(b) Types of Hypothesis:
In testing for the validity of a hypothesis we usually
propose two types of hypotheses namely;

i) Null Hypothesis, denoted , which is the


tentative statement assumed to be true.

ii) Alternative Hypothesis, denoted , which


contradicts the null hypothesis. It is accepted only
when sufficient evidence exist to establish its
truth.
Formulation of H0 and H1
Testing the validity of a claim
• The claim made is chosen as
the null hypothesis while the
challenge to the claim is taken
as the alternative hypothesis.
(c) Formulation of and
When we wish to establish the validity of a
statement about a population using the evidence
obtained from a random sample data, the
negative of the statement is what we take as the
null hypothesis. The statement itself constitutes
the alternative hypothesis. In some applications,
it is not obvious how and should be
formulated. The following guidelines for
developing hypothesis of three types of
situations are suggested.
(i) Testing Research Hypothesis: This is formulated as
alternative hypothesis.

(ii) Testing the validity of a claim: This generally corresponds


to the “innocent until proven guilty” analogy. The claim
made is chosen as the null hypothesis while the challenge
to the claim is taken as the alternative hypothesis.

(iii) Testing in decision making situations: This occurs when


the decision-maker must choose between two courses of
action, one associated with and the other with .
If example, the decision involves the population
parameter, we should have the two hypothesis
formulated as:
where is a particular value of and an instant
action is taken if is rejected.
Hypothesis Testing of Population
Means

For single means


Forms of Tests:
In general a hypothesis testing involving a
parameter, say takes one of the following
forms:
(i) One-Tailed test to the right which is formulated
as:
(ii) One-Tailed test to the left, formulated as:
(iii) Two-Tailed Test formulated as:
Test Statistic
• It is a formular that leads to the
rejection or the acceptance of the
null hypothesis.
The test-statistic is
DECISION RULE
• is compared with the critical value or

• t is compared with the critical value


or

Reject if or
AN OUTLINE FOR HYPOTHESIS TESTING

• State and
• Choose the level of significance
• Select a test statistic
• Find the critical region
• Compute the value of the statistic
• Draw conclusions (Reject or Accept)
Example
A car manufacturer claims that average weekly
income of owners of his car is $180. An
investigator takes a random sample of 200 such
car owners and finds out that they have an
average weekly income of $184.26 with a
standard deviation of $24.12. On the bases of
the sample, do you agree on the
manufacturer’s claim. (Test at 5% significance
level)
Solution

Since 2.50 is outside the acceptance region, we


reject And conclude that the weekly
income of the car owners is not $180.
Errors in Hypothesis Testing:
When H0 is tested against H1 using a randomly
selected sample data, two possible errors may
be committed.

These are the Type I and Type II errors which


have come about as a result of the decisions
which are taken. These are illustrated in the
diagram below:
Actual Situation
Decision is true is false
( is true)

Accept Correct decision Type II error

Reject Type I error Correct decision


(i) Type I error is committed when the null
hypothesis, is rejected when in actual
situation it is true. The probability of
committing this error is , which is also
referred to level of significance and indicates
the size of the critical region.

(ii) Type II error is committed when is


accepted when in actual situation it is false. The
probability of committing this error is .
P-value
For given level of significance α , the null
hypothesis

i. Is rejected if p-value < α

ii. Is failed to be rejected if p-value > α


• Let α=0.05

(HS ) Reject (S) Accept (NS)

0.01 0.05
(g) P-Value:
The P-value is the smallest level of significance for which
the observed data would call for rejection of in
favour of . The p-value dives additional insight into
the strength of the decision taken. A very small p-value,
such as 0.0001, indicates that there is virtually no
likelihood that is true. On the other hand, a high p-
value such as 0.2 means that is not rejected and
there is little likelihood that it is false. The p-value is
often referred to as the observed level of significance.
For given level of significance, , null hypothesis,
i. Is rejected if p-value
ii. Is failed to be rejected if p-value
END

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