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Hypothesis Testing for a Proportion

Learn the Steps to Perform Hypothesis Testing for Proportion by BookMyEssay.<br>Read more: https://www.bookmyessay.com/hypothesis-testing-assignment/

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Hypothesis Testing for a Proportion

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  1. Hypothesis Testing for a Proportion

  2. Statistics forms an important part of most systems including business, engineering as well as science. To understand if the proportion expected is significantly different from the actual proportion, a hypothesis test for proportion is required. Majoring in statistics opens a large number of avenues for people including those in investment banking, financial sector, risk and data analysis, industries like consumer products, healthcare, manufacturing, and technology sector. Since hypothesis testing forms a major part of the job, you need to be excellent in it.

  3. Steps to Perform Hypothesis Testing for Proportion

  4. Formulation of Research Question The objective of the research should be clear before formulating the questions. Also, keep in mind that the statistical analysis (a test used) depends on the questions asked. Be clear of the objective and ultimate goal before formulating the questions. Opt for Simple Random Sampling Select a random sample where the result can be one of the two possible outcomes – success or failure. Also, keep in mind that the population size must be 20 times the sample size and the sample should include 10 positive and negative results.

  5. State Null Hypothesis and Alternate Hypothesis The Null Hypothesis contains equality and is to be refuted while the alternate hypothesis is the one which individual is trying to confirm. Both these hypothesis are mutually exclusive (i.e. only one can be true at a time) and collectively exhaustive (either of the 2 outcomes must occur) Set Significance Level (Alpha) Alpha is the probability of rejecting the null hypothesis in case it is true. Generally, the significance level is set at 0.05, but 0.1 and 0.01 levels are also used.

  6. Calculate Test Statistics (Z test) Select a random sample where the result can be one of the two possible outcomes – success or failure. Also, keep in mind that the population size must be 20 times the sample size and the sample should include 10 positive and negative results. Convert Test Statistics to find Probability (p-value) The p-value in a randomly selected sample would have sample statistics as different as that obtained. In a normal curve, it is the tail area in the alternative hypothesis direction.

  7. Use Probability to Select between Null Hypothesis and Alternate Hypothesis Compare the null hypothesis with the alternate hypothesis using p-value and alpha. If p<alpha, the null hypothesis is rejected, in case p>alpha, the null hypothesis is accepted. Conclude Your Research Based on the statistical analysis conducted, you can conclude your research in favor of or against the hypothesis.

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