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# Lecture24 - ECO220Y Lecture 24 Introduction to Hypothesis...

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ECO220Y Lecture 24 Introduction to Hypothesis Testing Migiwa Tanaka Reading:11.1 1

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Outline Introduction to Hypothesis Testing Testing population mean when the population variance is known Rejection Region Method p-value Method One-tail vs. two-tail Test Calculating the probability of a type II error 2
Hypothesis Testing Step1: Identify hypotheses about a population parameter Step2: Collect a sample Step3: Conduct hypothesis testing: Conclude whether the hypotheses set up in step 1 is true or not, using evidence found in the sample. A. Calculate a test statistic B. Compare A. with the decision criteria 3

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Analogy with Criminal Trial (1) Hypothesis Testing C i i l T i l Criminal Trial Unknown: Population P Unknown: Defendant’s Guilt Parameter Construct hypotheses about population parameter Construct hypotheses about defendant’s guilt population parameter. Collect a sample from the population Collect evidence relevant to the crime. Calculate test statistics. Based on the evidence in a sample, test hypothesis. Based on the evidence, test hypothesis 4
Hypotheses All hypotheses are constructed in a pair. 1 N ll H th i (H ) I iti l ti b t th 1. Null Hypothesis (H 0 ): Initial presumption about the population, which is not based on the data. Status quo. 2. Alternative Hypothesis (H 1 ): The statement that can be proven by the data. New regime. It is also called research hypothesis hypothesis.

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Lecture24 - ECO220Y Lecture 24 Introduction to Hypothesis...

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