CHAPTER 2:

ESTIMATION AND HYPOTHESIS

TESTING: TWO POPULATIONS
 INFERENCES ABOUT THE
DIFFERENCE BETWEEN TWO
POPULATION MEANS FOR LARGE
AND INDEPENDENT SAMPLES

 Independent versus Dependent

Samples
 Mean, Standard Deviation, and
Sampling Distribution of x1 – x2
 Interval Estimation of μ1 – μ2
 Hypothesis Testing About μ1 – μ2

2
Independent versus
Dependent Samples
Definition
Two samples drawn from two
populations are independent if the
selection of one sample from one
population does not affect the
selection of the second sample from
the second population. Otherwise,
the samples are dependent.
3
Example 6-1
Suppose we want to estimate the
difference between the mean salaries of all
male and all female executives. To do so,
we draw two samples, one from the
population of male executives and another
from the population of female executives.
These two samples are independent
because they are drawn from two different
populations, and the samples have no
effect on each other.
4
Example 6-2
Suppose we want to estimate the
difference between the mean weights of
all participants before and after a weight
loss program. To accomplish this, suppose
we take a sample of 40 participants and
measure their weights before and after
the completion of this program. Note that
these two samples include the same 40
participants. This is an example of two
dependent samples. Such samples are
also called paired or matched samples.
5
 Mean, Standard Deviation,
and Sampling Distribution of
x1 – x2

Figure 6.1

Approximately  12  22
normal for n1 ≥ 30 xx  
1 2
n1 n2
and n2 ≥ 30

1   2 x1  x 2
6
 Sampling Distribution, Mean,
and Standard Deviation of x1 –
x2 cont.

For two large and independent

samples selected from two different
populations, the sampling x1  x 2
distribution of is
(approximately) normal with its mean
and standard deviation as follows:
 12  22
 x1  x2 1   2 and  x1  x2  
n1 n2

7
 Sampling Distribution, Mean,
and Standard Deviation of x1 –
x2 cont.

Estimate of the Standard Deviation of x1 – x2

The values x1  x2 , which gives an estimate
ofx1  x2 , is calculates as
2 2
s s
s x1  x2  1
 2

n1 n2
where s1 and s2 are the standard deviation of
the two samples selected from the two
populations.
8
 Interval Estimation of μ1 –
μ2
The (1 – α)100% confidence interval for
μ1 – μ2 is

( x1  x 2 ) z x1  x2 if σ1 and σ2 are known

( x1  x 2 ) zs x1  ifx2 σ1 and σ2 are not known
The value of z is obtained from the normal
distribution table for the given confidence
 x1  x2 of s x  xand
level. The values are
calculated as explained1 earlier. 2
9
 Example 6-3
According to the U.S. Bureau of the Census,
the average annual salary of full-time state
employees was $49,056 in New York and
$46,800 in Massachusetts in 2001 (The
Hartford Courant, December 5, 2002).
Suppose that these mean salaries are
based on random samples of 500 full-time
state employees from New York and 400
full-time employees from Massachusetts
and that the population standard
deviations of the 2001 salaries of all full-
time state employees in these two states
were $9000 and $8500, respectively.
10
 Example 6-3
a) What is the point estimate of μ1 – μ2?
What is the margin of error?
b) Construct a 97% confidence interval
for the difference between the 2001
mean salaries of all full-time state
employees in these two states.

11
 Solution 6-3
a)
Point estimate of μ1 – μ2 =x1  x 2
= $49,056 - $46,800
= $2256

12
 Solution 6-3
a)

 12  22
(9000) 2 (8500) 2
xx    
1 2
n1 n2 500 400
$585.341781
Margin of error 1.96 x1  x2
1.96(585.341781) $1147.27

13
 Solution 6-3
b)
 97% confidence level
 Thus, the value of z is 2.17
( x1  x 2 ) z x1  x2 (49,056  46,800) 2.17(585.341781)
2256 1270.19 $985.81 to $3526.19
 Thus, with 97% confidence we can state
that the difference between the 2001
mean salaries of all full-time state
employees in New York and Massachusetts
is $985.81 to $3526.19. 14
 Example 6-4
According to the National Association of
Colleges and Employers, the average salary
offered to college students who graduated in
2002 was $43,732 to MIS (Management
Information Systems) majors and $40,293 to
accounting majors (Journal of Accountancy,
September 2002). Assume that these means
are based on samples of 900 MIS majors and
1200 accounting majors and that the sample
standard deviations for the two samples are
$2200 and $1950, respectively. Find a 99%
confidence interval for the difference
between the corresponding population
means. 15
 Solution 6-4
s12 s 22 (2200) 2 (1950) 2
s x1  x2     $92.447433
n1 n2 900 1200

The value of z is 2.58.

( x1  x 2 ) zs x1  x2 ($43,732  $40,293) 2.58(92.447433)
3439 238.51
$3200.49 to $3677.51

16
 Hypothesis Testing About
μ1 – μ2
1. Testing an alternative hypothesis
that the means of two populations
are different is equivalent to μ1 ≠ μ2,
which is the same as μ1 - μ2 ≠ 0.

17
 HYPOTHESIS TESTING
ABOUT μ1 – μ2 cont.
2. Testing an alternative hypothesis
that the mean of the first population
is greater than the mean of the
second population is equivalent to μ1
> μ2, which is the same as μ1 - μ2 >
0.

18
 HYPOTHESIS TESTING
ABOUT μ1 – μ2 cont.
3. Testing an alternative hypothesis
that the mean of the first population
is less than the mean of the second
population is equivalent to μ1 < μ2,
which is the same as μ1 - μ2 < 0.

19
 HYPOTHESIS TESTING
ABOUT μ1 – μ2 cont.
Test Statistic z for x1 – x2
The value of the test statistic z xfor 1  x2
is computed as
( x1  x2 )  ( 1   2 )
z
x x
1 2

The value of μ1 – μ2 is substituted from

H0. If the values of σ1 and σ2 are not
known,we s x1  x2 with
x1  xreplace
2
in
the formula. 20
 Example 6-5
Refer to Example 6-3 about the 2001
average salaries of full-time state
employees in New York and
Massachusetts. Test at the 1%
significance level if the 2001 mean
salaries of full-time state employees in
New York and Massachusetts are
different.
21
 Solution 6-5
 H0: μ1 – μ2 = 0 (the two population
means are not
different)
 H1: μ1 – μ2 ≠ 0 (the two population
means are different)

22
 Solution 6-5
 Both samples are large; n1 > 30 and
n2 > 30
 Therefore, we use the normal
distribution to perform the hypothesis
test

23
 Solution 6-5
 α = .01.
 The ≠ sign in the alternative
hypothesis indicates that the test is
two-tailed
 Area in each tail = α / 2 = .01 / 2
= .005

The critical values of z are 2.58 and -
2.58
24
Figure 6.2

α /2 = .005 α /2 = .005

.4950 .4950
μ1 – μ2 = 0 x1  x 2
Reject H0 Do not reject H0 Reject H0

-2.58 0 z
2.58 Two critical values of z 25
 Solution 6-5

 12  22 (9000) 2 (8500) 2
xx     $585.341781
1 2
n1 n2 500 400
( x1  x 2 )  ( 1   2 ) (49,056  46,800)  0
z  3.85
xx 1 2
585.341781

From H0

26
 Solution 6-5
 The value of the test statistic z =
3.85
 It falls in the rejection region.
 We reject the null hypothesis H0.

27
 Example 6-6
Refer to Example 6-4 about the mean
salaries offered to college students
who graduated in 2002 with MIS and
accounting majors. Test at the 2.5%
significance level if the mean salary
offered to college students who
graduated in 2002 with the MIS major
is higher than that for accounting
majors.
28
 Solution 6-6
 H0: μ1 – μ2 = 0
 μ1 is equal to μ2
 H1: μ1 – μ2 > 0
 μ1 is higher than μ2

29
 Solution 6-6
 α = .025.
 The > sign in the alternative
hypothesis indicates that the test is
right-tailed

The critical value of z is 1.96

30
Figure 6.3

α = .025

.4750

μ1 – μ2 = 0 x1  x 2
Do not reject H0 Reject H0

0 z
1.96 Critical value of z 31
 Solution 6-6

s12 s 22 (2200) 2 (1950) 2

s x1  x2     $92.447433
n1 n2 900 1200
( x1  x 2 )  ( 1   2 ) (43,732  40,293)  0
z  37.20
s x1  x2 92.447433

From H0

32
 Solution 6-6

The value of the test statistic z =
37.20
 It falls in the rejection region.
 We reject H0.

33
 INFERENCES ABOUT THE DIFFERENCE
BETWEEN TWO POPULATION MEANS FOR
SMALL AND INDEPENDENT SAMPLES: EQUAL
STANDARD DEVIATIONS

 Interval Estimation of μ1 – μ2
 Hypothesis Testing About μ1 – μ2

34
 When to Use the t
Distribution to Make
Inferences About μ1 – μ2
The t distribution is used to make
inferences about μ1 – μ2 when the following
assumptions hold true:
1. The two populations from which the two
samples are drawn are (approximately)
normally distributed.
2. The samples are small (n1 < 30 and n2 < 30)
and independent.
3. The standard deviations σ1 and σ2 of the two
populations are unknown but they are assumed
to be equal; that is, σ1 = σ2.
35
 Pooled Standard Deviation
for Two Samples
The pooled standard deviation for two
samples is computed as
(n1  1) s12  (n2  1) s 22
sp 
n 1 n 2  2

where n1 and n2 are the sizes of the two

s12 and
samples s 22 and are the variances of
the two samples. s p Hence is an estimator
of σ.
36
 INFERENCES ABOUT THE DIFFERENCE
BETWEEN TWO POPULATION MEANS FOR
SMALL AND INDEPENDENT SAMPLES: EQUAL
STANDARD DEVIATIONS cont.

Estimator of the Standard Deviation of x1 –

x2
x1  of
The estimator x 2 the standard
deviation of is
1 1
s x1  x2 s p 
n1 n2

37
 Interval Estimation of μ1 –
μ2
Confidence Interval for μ1 – μ2
The (1 – α)100% confidence interval for
μ1 – μ2 is
( x1  x2 ) ts x1  x2
where the value of t is obtained from the t
distribution table for a given confidence
s x1  x2
level and n1 + n2 – 2 degrees of freedom,
and is calculated as explained
earlier.
38
 Example 6-7
A consuming agency wanted to estimate
the difference in the mean amounts of
caffeine in two brands of coffee. The
agency took a sample of 15 one-pound jars
of Brand I coffee that showed the mean
amount of caffeine in these jars to be 80
milligrams per jar with a standard deviation
of 5 milligrams. Another sample of 12 one-
pound jars of Brand II coffee gave a mean
amount of caffeine equal to 77 milligram
per jar with a standard deviation of 6 39
Example 6-7
Construct a 95% confidence interval
for the difference between the mean
amounts of caffeine in one-pound
jars of these two brands of coffee.
Assume that the two populations are
normally distributed and that the
standard deviations of the two
populations are equal.
40
 Solution 6-7

(n1  1) s12  (n2  1) s 22 (15  1)(5) 2  (12  1)(6) 2

sp  
n1  n2  2 15  12  2
5.46260011
1 1 1 1
s x1  x2  s p  (5.46260011)  2.11565593
n1 n2 15 12

41
 Solution 6-7
Area in each tail /2 .5  (.95 / 2) .025
Degrees of freedom n1  n2  2 25
t 2.060
( x1  x 2 ) ts x1  x2 (80  77) 2.060(2.11565593)
3 4.36
 1.36 to 7.36 milligrams

42
 Hypothesis Testing About
μ1 – μ2

Test Statistic t for x1 – x2
 The value of the test statistic t for
x1 – x2 is computed as
( x1  x2 )  ( 1   2 )
t
s x1  x2
 The value of μ1 – μ2 in this formula is
substituted from the null hypothesis
s x1  x2
and is calculated
as explained earlier. 43
 Example 6-8
 A sample of 14 cans of Brand I diet
soda gave the mean number of
calories of 23 per can with a standard
deviation of 3 calories. Another
sample of 16 cans of Brand II diet
soda gave the mean number of
calories of 25 per can with a standard
deviation of 4 calories.
44
 Example 6-8
 At the 1% significance level, can you
conclude that the mean number of
calories per can are different for
these two brands of diet soda?
Assume that the calories per can of
diet soda are normally distributed for
each of the two brands and that the
standard deviations for the two
populations are equal.
45
 Solution 6-8
 H0: μ1 – μ2 = 0
 The mean numbers of calories are not
different
 H1: μ1 – μ2 ≠ 0
 The mean numbers of calories are
different

46
 Solution 6-8
 The two populations are normally
distributed
 The samples are small and
independent
 Standard deviations of the two
populations are unknown
 We will use the t distribution

47
 Solution 6-8
 The ≠ sign in the alternative
hypothesis indicates that the test is
two-tailed.
 α = .01.
 Area in each tail = α / 2 = .01 / 2
= .005
 df = n1 + n2 – 2 = 14 + 16 – 2 = 28
 Critical values of t are -2.763 and
2.763. 48
 Figure 6.4

Reject Do not reject H0 Reject

H0 H0
α/2 = .005 α/2 = .005

-2.763 0 2.763 t
Two critical values
of t 49
 Solution 6-8

(n1  1) s12  (n2  1) s 22 (14  1)(3) 2  (16  1)(4) 2

sp   3.57071421
n1  n2  2 16  16  2
1 1 1 1
s x1  x2  s p  (3.57071421)  1.30674760
n1 n2 14 16
( x1  x 2 )  ( 1   2 ) (23  25)  0 From H0
t   1.531
s x1  x2 1.30674760

50
 Solution 6-8
 The value of the test statistic t = -
1.531
 It falls in the nonrejection region
 Therefore, we fail to reject the null
hypothesis

51
 Example 6-9
 A sample of 15 children from New York
State showed that the mean time they
spend watching television is 28.50
hours per week with a standard
deviation of 4 hours. Another sample
of 16 children from California showed
that the mean time spent by them
watching television is 23.25 hours per
week with a standard deviation of 5
hours.
52
 Example 6-9
 Using a 2.5% significance level, can
you conclude that the mean time
spent watching television by children
in New York State is greater than that
for children in California? Assume that
the times spent watching television by
children have a normal distribution for
both populations and that the
standard deviations for the two
populations are equal.
53
 Solution 6-9
 H0: μ1 – μ2 = 0
 H1: μ1 – μ2 > 0

54
 Solution 6-8
 The two populations are normally
distributed
 The samples are small and
independent
 Standard deviations of the two
populations are unknown
 We will use the t distribution

55
 Solution 6-9
 α = .025
 Area in the right tail = α = .025
 df = n1 + n2 – 2 = 15 + 16 – 2 = 29
 Critical value of t is 2.045

56
Figure 6.5

Do not reject H0 Reject

H0

α
= .025

0 2.045 t
Critical value of t

57
 Solution 6-9

(n1  1) s12  (n2  1) s 22 (15  1)(4) 2  (16  1)(5) 2

sp   4.54479619
n1  n2  2 15  16  2
1 1 1 1
s x1  x2  s p  (4.54479619)  1.63338904
n1 n2 15 16
( x1  x 2 )  ( 1   2 ) (28.50  23.25)  0 From H0
t  3.214
s x1  x2 1.63338904

58
 Solution 6-9

The value of the test statistic t =
3.214
 It falls in the rejection region
 Therefore, we reject the null
hypothesis H0

59
 INFERENCES ABOUT THE
DIFFERENCE BETWEEN TWO
POPULATION MEANS FOR PAIRED
SAMPLES

 Interval Estimation of μd
 Hypothesis Testing About μd

60
 INFERENCES ABOUT THE
DIFFERENCE BETWEEN TWO
POPULATION MEANS FOR PAIRED
SAMPLES cont.

 Definition
 Two samples are said to be paired or
matched samples when for each
data value collected from one sample
there is a corresponding data value
collected from the second sample,
and both these data values are
collected from the same source.
61
 INFERENCES ABOUT THE
DIFFERENCE BETWEEN TWO
POPULATION MEANS FOR PAIRED
SAMPLES cont.
 Mean and Standard Deviation of the Paired
Differences for Two Samples
 The values of the mean and standard d
sd
deviation, and , of paired differences for

d

two samples are calculated
d as
n

d  n
2 (  d ) 2

sd 
n 1 62
 INFERENCES ABOUT THE
DIFFERENCE BETWEEN TWO
POPULATION MEANS FOR PAIRED
SAMPLES cont.
 Sampling Distribution, Mean, and Standard
Deviation of d
 If the number of paired values is large
(n ≥ 30), then because of the
central limit theorem, the sampling d
distribution of is approximately
normal with its mean and standard
deviation 
 given
d
 and
d
as   d
d
n 63
 INFERENCES ABOUT THE
DIFFERENCE BETWEEN TWO
POPULATION MEANS FOR PAIRED
SAMPLES cont.

Estimate of the Standard Deviation of

Paired Differences
If

n is less than 30
  d is not known
 the population of paired differences is
(approximately) normally distributed

64
 Estimate of the Standard
Deviation of Paired Differences
cont.
then the t distribution is used to
make inferencesabout
d . The
d
standard deviation dof of is
sd
estimated by , which is
calculated as
sd
sd 
n
65
 Interval Estimation of μd
Confidence Interval for μd
The (1 – α)100% confidence interval for μd
is d ts d

where the value of t is obtained from the t

distribution table for a givensconfidence
d
level and n – 1 degrees of freedom, and
is calculated as explained earlier.
66
 Example 6-12
 A researcher wanted to find the
effect of a special diet on systolic
blood pressure. She selected a
sample of seven adults and put them
on this dietary plan for three months.
The following table gives the systolic
blood pressures of these seven adults
before and after the completion of
this plan.
67
 Example 6-12

Befor 210 180 19 22 23 19 224

e 5 0 1 9
After 193 186 18 22 22 18 223
6 3 0 3

68
 Example 6-12
 Let μd be the mean reduction in the
systolic blood pressure due to this
special dietary plan for the population
of all adults. Construct a 95%
confidence interval for μd. Assume
that the population of paired
differences is (approximately)
normally distributed.
69
Solution 6-12
Table 6.1
Difference
Before After
d d2
210 193 17 289
180 186 -6 36
195 186 9 81
220 223 -3 9
231 220 11 121
199 183 16 256
224 233 -9 81
Σd = 35 Σd² = 873 70
 Solution 6-12

d
 d 35
 5.00
n 7

 d 2

(  d ) 2

873 
(35) 2

sd  n  7 10.78579312
n 1 7 1

71
 Solution 6-12
Hence,
sd 10.78579312
sd   4.07664661
n 7
Area in each tail /2 .5  (.95 / 2) .025
df n  1 7  1 6
t 2.447
d ts d 5.00 2.447(4.07664661) 5.00 9.98
 4.98 to 14.98 72
 Hypothesis Testing About
μd
 d
Test Statistic t for
 The value of the test statistic t d
for
is computed as follows:

d  d
t
sd

73
 Example 6-13
A company wanted to know if
attending a course on “how to be a
successful salesperson” can increase
the average sales of its employees.
The company sent six of its
salesperson to attend this course. The
following table gives the one-week
sales of these salespersons before and
after they attended this course.
74
 Example 6-13
Before 12 18 25 9 14 16
After 18 24 24 14 19 20

Using the 1% significance level, can you

conclude that the mean weekly sales for all
salespersons increase as a result of
attending this course? Assume that the
population of paired differences has a
normal distribution.
75
Solution 6-13
Table 6.2
Difference
Before After
d d2
12 18 -6 36
18 24 -6 36
25 24 1 1
9 14 -5 25
14 16 -5 25
16 20 -4 16
Σd = -25 Σd² = 139
76
 Solution 6-13

d 
 d  25
  4.17
n 6
( d ) 2 ( 25) 2
 
d 2

n
139 
6
sd   2.63944439
n 1 6 1
sd 2.63944439
sd   1.07754866
n 6

77
 Solution 6-13
 H0: μd = 0
 μ1 – μ2 = 0 or the mean weekly sales do
not increase
 H1: μd < 0
 μ1 – μ2 < 0 or the mean weekly sales do
increase

78
 Solution 6-13
 The sample size is small (n < 30)
 The population of paired differences
is normal

 d is unknown
 Therefore, we use the t distribution to
conduct the test

79
 Solution 6-13
 α = .01.
 Area in left tail = α = .01
 df = n – 1 = 6 – 1 = 5
 The critical value of t is -3.365

80
 Figure 6.7

Reject H0 Do not reject H0

α = .01

-3.365 0
t
Critical value of t

81
 Solution 6-13

From H0

d  d  4.17  0
t   3.870
sd 1.07754866

82
 Solution 6-13
 The value of the test statistic t = -
3.870
 It falls in the rejection region
 Therefore, we reject the null
hypothesis

83
 Example 6-14
Refer to Example 6-12. The table that
gives the blood pressures of seven
adults before and after the completion
of a special dietary plan is reproduced
here.
Befor 210 180 19 22 23 19 224
e 5 0 1 9
After 193 186 18 22 22 18 233
6 3 0 3
84
 Example 6-14
Let μd be the mean of the differences
between the systolic blood pressures
before and after completing this special
dietary plan for the population of all adults.
Using the 5% significance level, can we
conclude that the mean of the paired
differences μd is difference from zero?
Assume that the population of paired
differences is (approximately) normally
distributed.
85
Table 6.3
Solution 6-14
Difference
Before After
d d2
210 193 17 289
180 186 -6 36
195 186 9 81
220 223 -3 9
231 220 11 121
199 183 16 256
224 233 -9 81
Σd = 35 Σd² = 873 86
 Solution 6-13

d 
 d 35
 5.00
n 7
( d ) 2 (35) 2
 
d 2

n
873 
7 10.78579312
sd  
n 1 7 1
sd
10.78579312
sd   4.07664661
n 7

87
 Solution 6-14
 H0: μd = 0
 The mean of the paired differences is not
different from zero
 H1: μd ≠ 0
 The mean of the paired differences is
different from zero

88
 Solution 6-14
 Sample size is small
 The population of paired differences
is (approximately) normal

 d is not known

Therefore, we use the t distribution

89
 Solution 6-14
 α = .05
 Area in each tail = α / 2 = .05 / 2
= .025
 df = n – 1 = 7 – 1 = 6

The two critical values of t are -2.447
and 2.447

90
 Solution 6-14

From H0

d  d 5.00  0
t  1.226
sd 4.07664661

91
 Figure 6.8

Reject Do not reject H0 Reject

H0 H0
α/2 = .025 α/2 = .025

-2.447 0 2.447 t
Two critical values
of t 92
 Solution 6-14

The value of the test statistic t =
1.226
 It falls in the nonrejection region
 Therefore, we fail to reject the null
hypothesis

93
 INFERENCES ABOUT THE DIFFERENCE
BETWEEN TWO POPULATION
PROPORTIONS FOR LARGE AND
INDEPENDENT SAMPLES

 Mean, Standard Deviation, and

Sampling Distribution
pˆ 1  pˆ 2 of
 Interval Estimation of p1  p 2
 Hypothesis Testing About p1  p 2

94
 Mean, Standard Deviation,
pˆ 1  pˆof
and Sampling Distribution 2

For two large and independent samples, the

sampling distribution ofpˆ 1  pˆ 2 is
(approximately) normal with its mean and
standard deviation given as
 pˆ  pˆ  p1  p2
1 2

and
p1q1 p2 q2
 pˆ  pˆ  
1 2
n1 n2
respectively, where q1 = 1 – p1 and q2 = 1 –
p 2. 95
 Interval Estimation of p1 –
p2
The (1 – α)100% confidence interval
for p1 – p2 is
( pˆ 1  pˆ 2 ) zs pˆ1  pˆ 2

where the value of z is read from the

normal distribution table for the given
confidence level, ands pˆ1  pˆ 2 is
calculates as
p1 q1 p 2 q 2
s pˆ1  pˆ 2  
n1 n2
96
 Example 6-15
A researcher wanted to estimate the
difference between the percentages of
users of two toothpastes who will never
switch to another toothpaste. In a sample
of 500 users of Toothpaste A taken by this
researcher, 100 said that they will never
switch to another toothpaste. In another
sample of 400 users of Toothpaste B taken
by the same researcher, 68 said that they
will never switch to another toothpaste.
97
 Example 6-15
a) Let p1 and p2 be the proportions of all
users of Toothpastes A and B,
respectively, who will never switch to
another toothpaste. What is the point
estimate of p1 – p2?
b) Construct a 97% confidence interval for
the difference between the proportions of
all users of the two toothpastes who will
never switch.
98
 Solution 6-15

pˆ 1  x1 / n1 100 / 500 .20

pˆ 2  x 2 / n2 68 / 400 .17
Then,
qˆ1 1  .20 .80 and qˆ 2 1  .17 .83

99
 Solution 6-15
a) Point estimate of p1 – p2
ˆ
p
= 1  ˆ
p 2

= .20 – .17 = .03

100
 Solution 6-15
b)
n1 pˆ 1 500(.20) 100
n1 qˆ1 500(.80) 400
n2 pˆ 2 400(.17) 68
n2 qˆ 2 400(.83) 332
101
 Solution 6-15
b)
 Each of these values is greater than
5
 Both samples are large
 Consequently, we use the normal
distribution to make a confidence
interval for p1 – p2.

102
 Solution 6-15
b) ˆ 1  pˆ 2
The standard deviation pof is
pˆ 1 qˆ1 pˆ 2 qˆ 2
s pˆ1  pˆ 2   .02593742
n1 n2
z = 2.17
( pˆ 1  pˆ 2 ) zs pˆ1  pˆ 2 (.20  .17) 2.17(.02593742)
.03 .056  .026 to .086

103
 Hypothesis Testing About
p1 – p2
Test Statistic z for
pˆ 1  pˆ 2
The value of the test statistic z pˆfor ˆ
1  p2
is calculated as
( pˆ 1  pˆ 2 )  ( p1  p2 )
z
s pˆ1  pˆ 2
The value of p1 – p2 is substituted
from H0, which is usually zero.
104
Hypothesis Testing About
p1 – p2 cont.
p1 q1 p 2 q 2
 pˆ  pˆ  
1 2
n1 n2
x1  x2 n1 pˆ 1  n2 pˆ 2
p or
n1  n2 n1  n2
1 1
s pˆ1  pˆ 2  pq   
 n1 n2 
where q 1  p
105
Example 6-16
Reconsider Example 6-15 about the
percentages of users of two toothpastes
who will never switch to another
toothpaste. At the 1% significance level,
can we conclude that the proportion of
users of Toothpaste A who will never
switch to another toothpaste is higher
than the proportion of users of Toothpaste
B who will never switch to another
toothpaste?
106
Solution 6-16

pˆ 1  x1 / n1 100 / 500 .20

pˆ 2  x 2 / n2 68 / 400 .17

107
 Solution 6-16
 H0: p1 – p2 = 0
 p1 is not greater than p2
 H1: p1 – p2 > 0
 p1 is greater than p2

108
 Solution 6-16
 n1 p̂1 , n1 q̂1 , n 2 p̂ 2 , and n 2 qˆ 2 are all
greater than 5
 Samples sizes are large
 Therefore, we apply the normal
distribution
 α = .01
 The critical value of z is 2.33

109
Figure 6.9

α = .01

.4900

p1 - p 2 = 0 pˆ 1  pˆ 2
Do not reject H0 Reject H0

0 z
2.33 Critical value of z 110
 Solution 6-16

x1  x 2 100  68
p  .187
n1  n2 500  400
q 1  p 1  .87 .813
 1 1  1 1 
s pˆ1  pˆ 2  pq     (.187)(.813)   .02615606
 n1 n2   500 400 
( pˆ 1  pˆ 2 )  ( p1  p 2 ) (.20  .17)  0
z  1.15
s pˆ1  pˆ 2 .02615606

From H0
111
 Solution 6-16

The value of the test statistic z = 1.15
 It falls in the nonrejection region
 Therefore, we reject the null
hypothesis

112
 Example 6-17
According to a study by Hewitt Associates,
the percentage of companies that hosted
holiday parties was 67% in 2001 and 64%
in 2002 (USA TODAY, December 2, 2002).
Suppose that this study is based on
samples of 1000 and 1200 companies for
2001 and 2002, respectively. Test whether
the percentages of companies that hosted
holiday parties in 2001 and 2002 are
different. Use the 1% significance level.
113
 Solution 6-17
 H0: p1 – p2 = 0
 The two population proportions are not
different
 H1: p1 – p2 ≠ 0
 The two population proportions are
different

114
 Solution 6-17
 Samples are large and independent
 Therefore, we apply the normal
distribution
 n1 p̂1 ,n1 q̂1 ,n 2 p̂ 2 andn 2 qˆ 2 are all greater
than 5
 α = .01
 The critical values of z are -2.58 and
2.58
115
Figure 6.10

α /2 = .005 α /2 = .005

.4950 .4950
p1 - p 2 = 0 pˆ 1  pˆ 2
Reject H0 Do not reject H0 Reject H0

-2.58 0 z
2.58 Two critical values of z 116
 Solution 6-17
n1 pˆ 1  n2 pˆ 2 1000(.67)  1200(.64)
p  .654
n1  n2 1000  1200
q 1  p 1  .654 .346
 1 1  1 1 
s pˆ1  pˆ 2  pq     (.654)(.346)   .02036797
 n1 n2   1000 1200 
( pˆ 1  pˆ 2 )  ( p1  p 2 ) (.67  .64)  0
z  1.47
s pˆ1  pˆ 2 .02036797

From H0
117
 Solution 6-17

The value of the test statistic z =
1.47
 It falls in the nonrejection region
 Therefore, we fail to reject the null
hypothesis H0

118