Z-TEST

MONTILLA, KURT KUBAIN M.

CABUGATAN, HANIF S.
MENDEZ, MARIANO RYAN J.
 What is a Z TEST?

AZ-testis anystatistical testsfor which

thedistributionof thetest statisticunder thenull
hypothesis can be approximated by anormal
distribution. Because of thecentral limit theorem,
many test statistics are approximately normally
distributedforlargesamples.
For each significance level, theZ-test has a single
critical value (for example, 1.96 for 5% two tailed)
which makes it more convenient than theStudent'st-
testwhichhasseparatecriticalvaluesforeachsample
size
A z-test is a statistical test used to determine
whether two population means are different
when the variances are known and the
sample size is large.
The test statistic is assumed to have a
normal distribution, and nuisance
parameters such as standard deviation
should be known for an accurate z-test to be
performed.
 The Hypothesis Tests
The z-test is a hypothesis test in which the z-statistic
follows a normal distribution.
The z-test is best used for greater than 30 samples
because, under the central limit theorem, as the
number of samples gets larger, the samples are
considered to be approximately normally
distributed.
When conducting a z-test, the null and alternative
hypotheses, alpha and z-score should be stated.
Next, the test statistic should be calculated, and the
results and conclusion stated.
 BUT BEFORE THAT,
Here is how you run a one sample z- test State the Null
Hypothesis. This is one of the common stumbling
blocksin order to make sense of your sample and have
the one sample z test give you the right information you
must make sure youve written the null hypothesis and
alternate hypothesis correctly.
For example, you might be asked to test the hypothesis
that the mean weight gain of pregnant women was
more than 30 pounds. Your null hypothesis would be:
H0: = 30 and your alternate hypothesis would be H ,
sub>1: > 30.
All you do is put in the values you are given into the
formula. Your question should give you the sample
mean (xx ), the standard deviation (), and the
number of items in the sample (n). Your
hypothesized mean (in other words, the mean you
are testing the hypothesis for, or your null
hypothesis) is 0.
 PROBLEM
Suppose it is up to you to determine if a certain state receives

significantly more public school funding (per student) than

the USA average. You know that the USA mean public school
yearly funding is $6300 per student per year, with a standard
deviation of $400.
Next, suppose you collect a sample (n = 100) and determine
that the sample mean for New Jersey (per student per year) is
$8801.
Use the z-test and the correct Ho and Ha to run a hypothesis
test to determine if New Jersey receives significantly more
funding for public school education (per student per year).
 HYPOTHESIS
Problem: Do the new jersery receives significantly
more funding for public school education (per student
per year).
Hypothesis: The mean per student per year funding in
New Jersey is significantly greater than the average
per student per year funding over the entire USA.
Ho: mean per student per year funding for New Jersey
= mean per student per year funding for the USA
Ha: mean per student per year funding for New Jersey
> mean per student per year funding for the USA
NOTICE1: The Ha in this example is ONE-TAILED
because we are interested in seeing if New Jersey is
significantly GREATER than the population mean.
In a two-tailed test, the Ha contains a NOT EQUAL
and the test will see if there is a significant difference
(greater or smaller).
NOTICE2: The Ho is the null hypothesis and so
always contains the equal sign as it is the case for
which there is no significant difference between the
two groups.
 Statistics
Now, calculate the test statistic. In this example, we are
using the z-test and are doing this by hand. However, there
are many applications that run such tests. This Site has
several examples under the Stats Apps link.
z = (sample mean population mean) / [population
standard deviation/sqrt(n)]
z = (8801 6300) / [400/sqrt(100)]
z = 2501 / [400/10]
z = 2501 / [40]
z = 62.5
So, the z-test result, also called the test statistic is
62.5.
Formula to be used:
The alpha value is the percentage chance that you will
reject the null (choose to go with your Ha research
hypothesis as you conclusion) when in fact the Ho really
true (and your research Ha should not be selected).

This is also called a Type I error (choosing Ha when Ho

is actually correct).
The smaller the alpha, the smaller the percentage of
error, BUT the smaller the rejection regions and more
difficult to reject Ho.
Most research uses alpha at .05, which
creates only a 5% chance of Type I error.
However, in cases such as medical research,
the alpha is set much smaller.

In our case, we will use alpha = .05

This is ONE-TAILED test, therefore the rejection
region is any z-test value greater than the critical z
value for a one-tailed test with alpha = .05
The critical value for one-tailed z-test at
alpha = .05 is 1.645.
Therefore, the rejection region is any value
GREATER than 1.645.
 CONCLUSION

Our z-test result is 62.5.

This is very large!
62.5 is MUCH LARGER than 1.645 and so the result
of the z test is INSIDE the rejection region.
(The rejection region is all portions of the curve to
the right of 1.645. Why to the right? Because this is a
one-tailed test for which we are looking at whether
the sample is GREATER than the population).
Note: The p value in this case would be the
probability of getting a result of 62.5 randomly given
that the rejection region starts at 1.645.

The probability of getting 62.5 is nearly zero and so

the p value = 0. The actual calculation of the p
value is mathematically complicated and is often
done using a software like Excel, SPSS, SAS, R, etc.
This z-test has a significant result.
Conclusion:
The funding for New Jersey public schools (per
student per year) is significantly GREATER than the
average funding per student per year for the USA.
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