QUARTER 4 – MODULE 2

STATISTICS AND PROBABILITY

 TEST STATISTIC
A test statistic is a random variable that is
calculated from sample data and used in a
hypothesis test.
You can use test statistics to determine whether to
reject or accept the null hypothesis.
The test statistic compares your data with what is
expected under the null hypothesis.
 TEST STATISTIC
To identify the test statistic, you must consider whether the
population standard deviation/variance is known or
unknown.
If the population standard deviation σ is known, then the mean
has a normal distribution. Use z-test.
If the population standard deviation σ is unknown, then the
mean has a t- distribution. Use t-test.
Instead of the population standard deviation, use the sample
standard deviation.
 TEST-STATISTIC WHEN THE POPULATION VARIANCE
IS ASSUMED TO BE KNOWN
If the population variance is known or when the sample size is 30
or more, the critical values are determined using the z-table.
In a z-test, the sample is assumed to be normally distributed.
A z-score is calculated with population parameters such as
“population mean” and “population standard deviation”.
It is used to validate a hypothesis that the sample drawn belongs to
the same population.
When the variance is known and either the distribution is normal
or sample size is large, use a z-test statistic.
 TEST-STATISTIC WHEN THE POPULATION VARIANCE
IS ASSUMED TO BE KNOWN

In this condition, the

z-score is used. The
formula for z-score is
given by the formula
below.
EXAMPLES
 TEST- STATISTIC WHEN THE POPULATION VARIANCE IS
ASSUMED TO BE UNKNOWN

There are cases when z-score is unsuitable to use. A

distinct test statistic will be used then.
The t-score will be used in this case. Another condition
to observe when using t-score is when the sample size
n is less than 30, i.e., (𝑛 < 30) and the population is
normally or approximately normally distributed.
TEST- STATISTIC WHEN THE POPULATION VARIANCE IS
ASSUMED TO BE UNKNOWN

Note:
The general rule in using t
score when the sample
has:
a sample size below 30,
an unknown population
standard deviation.
EXAMPLES