05or001 13 chapter 11

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Unformatted text preview: .5 Appendix Table 9, pages 871–3 of the textbook, lists cutoff points or critical values that give an upper tail area of either 0.05 or 0.01. 13 Chapter 11 The application of interest is to test the null hypothesis: H0 : σ 2 = σ 2 population variances are equal X Y against the two‐sided alternative: H1 : σ 2 ≠ σ 2 population variances are not equal X Y When the null hypothesis is true, σ X = σ Y , and the random variable: 2 s2 X F= 2 sY 2 has an F( n − 1 , n − 1 ) distribution. x y From the numeric data set calculate the sample variances s2 and s2 . Arrange the two samples so that s2 > s2 . y x y x A test statistic is calculated as the variance ratio: s2 x 2 sy 2 2 The test statistic exceeds one since s x is bigger than s y . 14 Chapter 11 For a chosen significance level α , the decision rule is to reject the null hypothesis of equal variances if: s2 x 2 > Fc sy where Fc is the critical value from the F‐distribution that satisfies: P( F( n x − 1 , n y − 1 ) > Fc ) = α 2...
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This note was uploaded on 02/06/2014 for the course ECON ECON 325 taught by Professor Whistler during the Spring '10 term at The University of British Columbia.

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