Chapter 2

Lesson Hypothesis Testing

1 1.5 hrs

Lesson Objectives:

In this lesson, you are expected to:

1. Tell a statistical hypothesis from an ordinary hypothesis,
2. Develop functional ideas on the logic of hypothesis testing,
3. Gain operational definitions of basic concepts in hypothesis testing like the following:
(a) type I and type II errors, (b) level of significance of the test, (c) null hypothesis and
alternative hypothesis, (d) one-tailed test and two-tailed test, (e) critical region and
acceptance region
4. State the null hypothesis, the corresponding alternative hypothesis and the general
location of the critical region,

Introduction

The testing of a statistical hypothesis is perhaps the most important area of statistical
inference. But what is a statistical hypothesis? Is this the same as the hypothesis we
encountered in our science class? How do we test a statistical hypothesis?

Try it
Tell which of the following hypotheses can be considered a statistical hypothesis:
1. It will probably rain tomorrow.
2. The average height of adult Filipino is 5 feet and 4 inches.
3. There is no significant difference between the average height of adult male and
female Filipino.
Which of the three statements above is/are statistical hypothesis(es)? _______
_______________________________________________________________
Why did you say so? _____________________________________________
_______________________________________________________________
Now, check your idea of statistical hypothesis with the definition given in most statistics
books.

Read This

A. Definition of Statistical Hypothesis

A statistical hypothesis is an assertion or conjecture concerning one or more
population.

Try It.
Recall your definition of a population and check your answers to the three statements
above.
Does the first statement (It will probably rain tomorrow) describe something about a
population? __________ If so, can you call it a statistical hypothesis? ______

What about statement 2? Does it describe a population? _____ If yes, what population is
mentioned here? ____________________________________________

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So, how do you classify this hypothesis, Statistical or Not? _____________________
Why? _______________________________________________________________

What about statement 3? Does it describe a population? _____ If yes, how many populations
are described here? What are these populations? __________________
____________________________________________________________________
So, how do you classify this hypothesis, Statistical or Not? _____________________
Why? _______________________________________________________________

I guess you answered NO to the first statement. This statement “It will probably rain
tomorrow” is NOT a statistical hypothesis because it does not assert or say something about
any population. It is just an ordinary hypothesis.
The second statement is a Statistical Hypothesis. Why? Notice that the statement “The
average height of adult Filipino is 5 feet and 4 inches” describes the set of heights of adult
Filipino. This set is a population. Notice also that there is an assertion or conjecture which
says that the “average height… is 5 feet and 4 inches.” So this statement is an assertion about
a certain (single) population. Thus, it is a statistical hypothesis.
The third statement is also a Statistical hypothesis. Why? Notice that the statement
“There is no significant difference between the average height of adult male and female
Filipino” describes two sets of populations. These are the set of heights of adult Filipino
males and the set of heights of adult Filipino females. Notice also that there is an assertion
that the averages or means of the two set are equal (i.e. no significant difference). Thus, this
statement is a statistical hypothesis.

Read Further

The truth or falsity of the statistical hypothesis is never known with certainty unless we
examine the entire population. This, of course, would be impractical in most situations.
Instead, we take a random sample from the population of interest and use the information
contained in this sample to decide whether the hypothesis is likely to be true or false.
Evidence from the sample that is inconsistent with the stated hypothesis leads to rejection of
the hypothesis, whereas evidence supporting the hypothesis leads to its acceptance. The
acceptance of a statistical hypothesis is a result of insufficient evidence to reject it and does
not necessarily imply that it is true. For example, in tossing a coin 100 times we might test the
hypothesis that the coin is balanced. In terms of population parameters, we are testing the
hypothesis that the proportion of heads is 50% (In symbol, p = 0.5) if the coin is tossed
indefinitely. An outcome of 48 heads would not be surprising if the coin is balanced. Such a
result would surely support the hypothesis p = 0.5. Although it can be argued that such an
occurrence is also consistent with the hypothesis that p = 0.45. Thus, in accepting the
hypothesis, the only thing we can be reasonably certain about is that the true proportion of
heads is not a great deal different from one half. If the 100 trials had resulted in only 35 heads,
we would then have a reasonable evidence to support the rejection of our hypothesis. In view
of the fact that the probability of obtaining 35 or fewer heads in 100 tosses of a balanced coin
is approximately 0.002, either a very rare event has occurred or we are right in concluding
that p  0.5.
Although we use the terms “accept” and “reject” frequently throughout this chapter, it is
important to understand that the rejection of a hypothesis is to conclude that it is false,
while the acceptance of a hypothesis merely implies that we have no evidence to believe
otherwise. Because of this terminology, the statistician or experimenter will often state as his
hypothesis that which he hopes to reject. For example, to prove that one teaching technique is
superior to another, we test the hypothesis that there is no difference in the two techniques.
Hypotheses that were formulated with the hope that they be rejected led to the use of the
term null hypotheses. Today this term is applied to any hypothesis we wish to test and is

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denoted by H0. The rejection of H0 leads to the acceptance of an alternative hypothesis,
denoted by H1. A null hypothesis concerning a population parameter will always be stated so
as to specify an exact value of the parameter, whereas the alternative hypothesis allows for the
possibility of several values. Hence, if H0 is the null hypothesis p = 0.5 for a binomial
population, the alternative hypothesis H1 might be p > 0.5, p < 0.5, or p  0.5.

B. Testing a Statistical Hypothesis

To illustrate the concepts used in testing a statistical hypothesis about a population,
consider the following example. A certain type of cold vaccine is known to be only 25%
effective after a period of 2 years. In order to determine if a new and somewhat more
expensive vaccine is superior in providing protection against the same virus for a longer
period of time, 20 people are chosen at random and inoculated. If 9 or more of those receiving
the new vaccine will receive relief the new vaccine will be considered superior to the one
presently in use. The choice of the number 9 is somewhat more arbitrary but appears
reasonable in that it represents a modest gain over the 5 people that could be expected to
receive protection if the 20 people had been inoculated with the vaccine already in use. We are
essentially testing the null hypothesis that the new vaccine is equally effective after a period
of 2 years as the now commonly used against the alternative hypothesis that the new vaccine
is in fact superior. This is equivalent to testing the hypothesis that the binomial parameter for
the probability of a success on a given trial is p = 0.25 against that p> 0.25. This is usually
written as follows:
H0: p = 0.25
H1: p > 0.25
The statistic on which we base our decision is X, the number of individuals in our test
group who receive protection from the new vaccine for a period of at least 2 years. The
possible values of X, from 0 to 20, are divided into two groups: those numbers less than 9 and
those greater than or equal to 9. All possible scores above 8.5 constitute the critical region,
and all possible scores below 8.5 constitute the acceptance region. The number x0 = 8.5
separating these two regions is called the critical value. Thus, if x > x0, we reject H0 in favor
of the alternative hypothesis H1. If x ≤ x0, we accept H0.
The decision procedure just described could lead to either of two wrong conclusions. For
instance, the new vaccine may be no better than the one now in use and, for this particular
randomly selected group of individuals, 9 or more surpass the 2-year period without
contracting the virus. We would be committing an error by rejecting H0 in favor of H1 when, in
fact, H0 is true. Such an error is called a type I error. To illustrate further this type of error,
consider this analogy. Suppose Juan dela Cruz is accused of committing rape, a heinous
crime. At the beginning of the trial, the judge will assume that Juan is not guilty (i.e.
innocent) unless proven by evidence. This assumption of innocence can be stated as a null
hypothesis as “Juan is not guilty.” The corresponding alternative hypothesis is “Juan is
guilty.” Suppose the null hypothesis that “Juan is not guilty” is true, but the judge decided to
reject it, then the judge has committed type 1 error.

DEFINITION: Type I Error

Rejection of the null hypothesis when it is true is called a type I error.

A second kind of error is committed if fewer than 9 of the group surpass the 2-year period
successfully, and we conclude that the new vaccine is no better when it actually is. In this case
we would accept H0 when it is false. This is called a type II error. Another example, by way
of analogy, is when Juan dela Cruz (in the above example) is actually guilty of committing
rape (i.e. the null hypothesis is false) but the judge decided to accept the null hypothesis and
thus set Juan free. This error is equivalent to type II error.

DEFINITION: Type II Error

Acceptance of the null hypothesis when it is false is called a type II error.

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 The probability of committing a type I error is also called the level of significance of the
test and is denoted by . In our illustration, a type I error will occur when 9 or more
individuals surpass a 2-year period without contracting the virus using a new vaccine that is
actually equivalent to the one in use.

Sometimes, the level of significance is called the size of the critical region. For example, if
the level of significance  is 0.05 then the size of the critical region is 0.05.

C. One-Tailed and Two-tailed Tests

A test of any statistical hypothesis, where the alternative is one-sided,

H0 :  =  0
H1:  >  0
or perhaps
H0 :  =  0,
H1:  <  0

is called a one-tailed test. The critical region for the alternative hypothesis  > 0 lies entirely
in the right tail of the distribution, while the critical region for the alternative hypothesis  <
0 lies entirely in the left tail. In a sense, the inequality symbol points in the direction where
the critical region lies.
A test of any statistical hypothesis where the alternative is two-sided,

H0:  =  0,
H1:    0,

is called a two-tailed test, since the critical region is split into two equal parts placed in each
tail of the distribution of the test statistic. The alternative hypothesis   0 states that either
 < 0 or > 0.

The null hypothesis, H0, will always be stated using the equality sign so as to specify a
single value. In this way the probability of committing a type I error can be controlled.
Whether one sets up a one-tailed or a two-tailed test will depend on the conclusion to be
drawn if H0 is rejected. The location of the critical region can be determined only after H1 has
been stated. For example, in testing a new drug, one sets up the hypothesis that it is no better
than similar drugs now on the market and tests this against the alternative hypothesis that the
new drug is superior. Such an alternative hypothesis will result in one-tailed test with the
critical region in the right tail. However, if we wish to compare a new teaching technique with
the conventional classroom procedure, the alternative hypothesis should allow for the new
approach to be either inferior or superior to the conventional procedure. Hence the test is two-
tailed with the critical region divided equally so as to fall in the extreme left and right tails of
the distribution of our statistic.

Example 1. The manufacturer of a certain brand of cigarettes claims that the average nicotine
content does not exceed 2.5 milligrams. State the null and alternative hypothesis to be used in
testing this claim and determine where the critical region is located.

Solution. The manufacturer’s claim should be rejected only if  is greater than 2.5 milligrams
and should be accepted if  is less than or equal to 2.5 milligrams. Since the null hypothesis
always specifies a single value of the parameter, we test

H0 :  = 2.5
H0 :  > 2.5

Although we have stated the null hypothesis with an equal sign, it is understood to include
any value not specified by the alternative hypothesis. Consequently, the acceptance of H0 does

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not imply that  is exactly equal to 2.5 milligrams but rather that we do not have sufficient
evidence favoring H1. The greater than symbol indicates that the critical region lies entirely in
the right tail of the distribution of our statistic x .

Example 2. A real estate agent claims that 60% of all private residences being built today are
3-bedroom homes. To test this claim, a large sample of new residences is inspected. The
proportions of these homes with 3 bedrooms is recorded and used as our static. State the null
alternative hypotheses to be used in this test and determine the location of the critical region.
Solution. If the test statistic is substantially higher or lower than p=0.6, we would reject the
agent’s claim. Hence we should make the test

H0 : p = 0.6
H1: p  0.6

The alternative hypothesis implies a two-tailed test with the critical region divided equally in
^
both tails of the distribution of
P , our test statistic.
In testing hypothesis in which the test statistic is discrete, the critical region may be
chosen arbitrarily and its size determined. If the size  is too large, it can be reduced by
making an adjustment in the critical value. It may necessary to increase the sample size to
offset the increase that automatically occurs in . In testing hypothesis in which the test
statistic is continuous, it is customary to choose the value of  to be 0.05 or 0.01 and then find
the critical region. For example, in a two-tailed test at the 0.05 level of significance, the
critical values for statistic having a standard normal distribution will be –z 0.025= - 1.96 and
z0.025= 1.96. In terms of z values, the critical region of size, 0.05 will be z< - 1.96 and z > 1.96.
A test is said to be significant if the null hypothesis is rejected at the 0.05 level of significance
and is considered to be highly significant if the null hypothesis is rejected at the 0.01 level of
significance.

The steps for testing a hypothesis concerning a population parameter  against some
alternative hypothesis may be summarized as follows:

1. State the null hypothesis H0 that  =0 ex: µ = 5’4”

2. Choose an appropriate alternative hypothesis H1 from one of the alternatives  < 0,  >
0, or   0 ex: µ > 5’4”
3. Choose a significance level of size .  = 0.05
4. Select the appropriate test statistic (formula) and establish the critical region.
(The test statistics will be discussed in the next lesson. Finding the exact location of the
critical region will also be discussed in the next lesson. For our present purpose, the
general location of the critical region in the above example is located to the right of the
distribution because the alternative hypothesis is a > symbol)
5. Compute the value of the test statistic from the sample data.
6. Decision: Reject H0 if the test statistic has a value in the critical region; otherwise, accept
H0.

Check Your Understanding

Answer the Posttest (i.e. Posttest for chapter 2, Lesson 1) given at the end of this lesson.