Hypothesis about the Difference of two Population Means Lecture 32

 Hypothesis about the Difference of two Population Means

Lecture 32

To test the hypothesis about the difference between population means. The following cases are to be considered.

Case 1: Hypothesis about the Difference between Population Means when σ1, σ2 are known.

To test the null hypothesis that the difference between the two population means is zero or some specified value. Let two independent random samples of size n1, n2 selected from two normal populations having means μ1, μ2 and known standard deviations σ1, σ2. Let X¯1, X¯2 be the estimates of μ1, μ2 computed from the values of the selected samples. The sampling distribution of (X¯1 - X¯2) approaches normal distribution. 

Suppose it is desired to test μ1 - μ2 = 
Testing Procedure:
i. State the null and alternative hypothesis

H0: μ1 - μ2 = ∘ Vs. H1: μ1 - μ2 ≠ 
H0: μ1 - μ2 ≥ ∘ Vs. H1: μ1 - μ2 < 
H0: μ1 - μ2  ∘ Vs. H1: μ1 - μ2 > 
ii. The Significance Level; α 
iii. The test statistic: As  σ1, σ2 is known.
under H0.
iv. Critical Region:

Reject H0 when |z| ≥ zα/2
Reject H0 when z < - zα
Reject H0 when z > zα
v. Computation:
vi. Remarks

Case 2: Hypothesis about the Difference between Population Means when σ1, σ2 are unknown.

To test the null hypothesis that the difference between the two population means is zero or some specified value. Let two independent random samples of size n1, nselected from two normal populations having means μ1, μ2 and unknown standard deviations σ1, σ2. As σ1, σ2 are unknown, so replace by its estimates S1, S2. Let X¯1, X¯2 be the estimates of μ1, μ2 computed from the values of the selected samples. If the sample sizes are large, then the sampling distribution of (X¯1 - X¯2) approaches normal distribution. 


Suppose it is desired to test μ1 - μ2 = 

The testing procedure remains the same.

Example 8.13: Ten percent of the BS botany & BS zoology students are chosen in order to check whether the two departments’ performance in the statistics course is the same or different. Two independent random samples of 12 and 15 students each are chosen from the BS botany and BS zoology programs. Such kind of research was also conducted in the past in both of the departments, with the standard deviations of BS botany and BS zoology being 1.5 and 2.13, respectively. Two random independent samples of size 12 and 15 students are selected from BS botany & BS zoology, respectively. The sample average GPAs of BS botany & zoology are 3.40 and 3.67, respectively. Test the claim that the performance of students in the statistics course of both departments is identical at the 5% significance level.

Solution: Let μ1 & μ2 represent the average performance of students of the BS botany & BS zoology departments. We setup our null & alternative hypotheses as:

i. State the null and alternative hypothesis

H0: μ1 - μ2 = 0 Vs. H1: μ1 - μ2 ≠ 0
Example 8.14: A market investigator claims that the average sale of a corner shop is more than the non-corner shop. To check the market investigator, claim two random and independent samples each of size 60 days of the corner and non-corner shops gave the average sale is $100 and $85 with a standard deviation of $5.40 and $6.23. The claim of the market investigator is validated at the 0.5% significance level.
Solution: Let μ1 & μ2 represent the average sales of corner and non-corner shops. We setup our null & alternative hypotheses as:

 i. State the null and alternative hypothesis

H0: μ μ2  Vs. H1: μ1 > μ2
or we can state as: 
H0: μ1 - μ2  0 Vs. H1: μ1 - μ2 > 0
ii. The Significance Level; α 
iii. The test statistic: As  σ1, σ2 is unknown but n1, n2 are sufficiently large.
under H0.
iv. Critical Region:
Reject H0 when z > z0.03 = 2.807
v. Computation:

vi. Remarks: The computed z value falls in the rejection region; the sample data does not provide sufficient evidence to accept the null hypothesis at the 0.5% significance level. Thus, it is concluded that the market investigator claim is validated.

Alternatively, P value can be used to decide about the above hypothesis

P value = P (z < 13.24)

P value = 1- P (z < 13.24)

P value = 1- 0.999

P value = 0.001

The P value (0.001) is less than the significance level (0.005). The null hypothesis is rejected.

Example 8.15: All mid-level finance industry professionals have a known standard deviation of $1100. The financial sector is where Firms A and B operate. Two random independent samples of size 130 and 145 mid-level employees from firms A and B are collected. The sample mean salaries are $8000 and $9600 for mid-level professionals in Firm A and Firm B, respectively. The management of Firms A and B would like to know if there is a mean difference in the salaries of their mid-level professional employees.

Solution: Let μ1 & μ2 represent the veragemid-level employees from companies A and B  We setup our null & alternative hypotheses as:
i. State the null and alternative hypothesis

H0: μ1 - μ2 = 0 Vs. H1: μ1 - μ2 ≠ 0
ii. The Significance Level; α 
iii. The test statistic: As  σ1, σ2 is unknown but n1, n2 are large enough.
iv. Critical Region:

Reject H0 when |z| ≥ z0.05/2 = 1.96

v. Computation:
vi. Remarks: The computed z value falls in the rejection region, so the sample data does not provide sufficient evidence to accept the null hypothesis. Thus, it concluded the mean salaries of both firms are significantly different.

Hypothesis Testing about Difference between Population Proportions

Let p^1 and p^2 be the estimates of P1 and P2 computed the values of two independent random samples of size n1, n2 selected from two binomial populations having proportion of success P1, P1. If n1, n2 are sufficiently large, then the sampling distribution of (p^1 - p^2) approaches a normal distribution. 

If H0: P1 - P2 = D  ≠ 0,
Then the following test statistic will be used:
If H0: P1 - P2 = 0
Then the following test statistic will be used:

The testing procedure remains the same.

Example 8.16: A random sample of 150 LED TVs manufactured by a company A showed 12 defective LED TVs, while a random sample of 100 LED TVs manufactured by another company B showed 4 defective LED TVs. Is there a significant difference between the proportion of defective LED TVs of two firms?

Solution: Let P1 and P2 be the proportion of defective LED TVs produced by companies A and B, respectively.

i. H0: P1 - P2 = 0 Vs. H1: P1 - P2 ≠ 0
ii. The significance level; α = 0.05
iii. The test statistic: As n1 & n2 are large enough, then

iv. Critical Region:
Reject H0 if |z| ≥ z0.05/2 = 1.96

v. Computation:

vi. Remarks: The computed z values fall in the acceptance region; the sample data does not provide sufficient evidence to reject the null hypothesis at the 5% significance level. Thus, it is concluded that the proportion of defective LED TVs produced by both companies is the same.

Example 8.17: The purpose of the study is to compare the proportions of adult patient responses to two different types of flue treatment. Twenty of the 200 people assigned to Medicine A respond in better condition. Then medicine B is prescribed; the remaining 200 patients exhibit the same flu-like symptoms, while 12 respond better. According to a doctor, drug A works 10% better than drug B.

Test at a 1% level of significance.

Solution:

i. H0: P1 - P2 = 0.10 Vs. H1: P1 - P2 ≠ 0.10
ii. The significance level; α = 0.01

iii. The test statistic: As n1 & n2 are large enough, then
iv. Critical Region:
Reject H0 if |z| ≥ z0.01/2 = 2.5758


v. Computation:

vi. Remarks: The computed z value falls in the acceptance region; the sample data does not provide sufficient evidence to reject the null hypothesis. It is concluded that the drug A is 10% more effective than drug B.

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