HYPOTHESIS TESTS ON PROPORTION

Tests of hypothesis concerning proportions are where:

required in many areas. For example, politicians are x 1+ x2
interested in knowing what fraction of the voters favor ^p= (pooled estimate of the proportion p)
n1+ n2
them in the next election; manufacturing firms are q^ =1− ^p
concerned about the proportion of defective items 4. Establish the critical region.
when a shipment is made; investors depend on a
One-sided alternative: |z|> z α
knowledge of the proportion of outcomes that they
consider favorable. Two-sided alternative: |z|> z α / 2
5. Compute the test statistic.
17.1 Tests on a Single Proportion 6. Decision
1. Ho: p= p 0 (The population proportion is equal to a
17.3 One-Sample Test Concerning a Variance
specified value p0.)
1. Ho: σ 2=σ 20 (The population variance is equal to a
Ha: p< p0, p> p0 or p ≠ p0 2
2. Choose a level of significance equal to α . specified value σ 0.)
Ha: σ 2> σ 20 , σ 2< σ 20 or σ 2 ≠ σ 20
3. Test statistic: *Binomial variable X with p= p 0 2. Choose a level of significance equal to α .
3. Test statistic: χ 2
4. P-value approach: Reject Ho if P-value is less than or 2 ( n−1 ) s2
equal to the level of significance α. χ=
σ 20
5. Computations: Find x , the number of successes, and where n=¿sample size
compute the appropriate P-value. s2=¿ sample variance
a) when Ha: p< p0, P=P ( X ≤ x when p= p 0 ) σ 20=¿value of σ ❑2 given by the null hypothesis
b) when Ha: p> p0, P=P ( X ≥ x when p= p 0 )
4. Critical region:
c) when Ha: p ≠ p0 , P=2 P ( X ≤ x when p= p0 ) if
One-sided alternatives σ 2< σ 20 and σ 2> σ 20: χ 2 < χ 21−α and
x <n p o or P=2 P ( X ≥ x when p= p0 ) if x >n p o
χ 2 > χ 2α respectively
6. Decision: Draw appropriate conclusions based on the Two-sided alternative: χ 2 > χ 2α /2 or χ 2 < χ 21−α /2
P-value.
5. Compute the test statistic.
*For large n , one may use normal approximation, the z - 6. Decision
value for testing p= p 0 is given by
x−n p0 ^p− p0 17.4 Two-Sample Test Concerning Variances
z= = 1. Ho: σ 12=σ 22
√ n p 0 q 0 √ p0 q0 /n 2 2 2 2 2 2
Ha: σ 1 < σ 2 , σ 1> σ 2 or σ 1 ≠ σ 2
where
^p=¿sample proportion 2. Choose a level of significance equal to α .
q 0=1− p 0 3. Test statistic: f
s 21
f= 2
17.2 Test on Two Proportions s2
1. Ho: p1= p2 (The population proportions are equal.) 2 2
where s1 and s2 are the variances computed from the
Ha: p1 < p2 , p1 > p2 or p1 ≠ p2 two samples
2. Choose level of significance equal to α . 4. Critical region:
3. Test statistic: One-sided alternatives σ 12< σ 22 and σ 12> σ 22:
^p 1−^p 2
z= f <f 1−α (υ 1 ,υ 2)and f >f α (υ 1 ,υ 2 ) respectively

√ ^p q^
( n1 + n1 )
1 2
Two-sided alternative:
f <f 1−α /2 (υ 1 ,υ 2)or f >f α /2 (υ 1 ,υ 2 )

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 HYPOTHESIS TESTS ON PROPORTION

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Note: f 1−α ( υ 1 , υ 2 )=
f α (υ2 , υ1 )
5. Compute test statistic.
6. Decision

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