Lecture Marketing research (12th edition) - Chapter 17: Hypothesis testing: Basic concepts and tests of association

Chapter 17 - Hypothesis testing: Basic concepts and tests of association. In this chapter, the following content will be discussed: Hypothesis testing - basic concepts, hypothesis testing process, basic concepts of hypothesis testing,. | Marketing Research Aaker, Kumar, Leone and Day Twelfth Edition Instructor’s Presentation Slides 1 Chapter Seventeen 2 Hypothesis Testing: Basic Concepts and Tests of Association Marketing Research 12th Edition Hypothesis Testing: Basic Concepts Assumption (hypothesis) made about a population parameter (not sample parameter) Purpose of Hypothesis Testing To make a judgment about the difference between two sample statistics or between sample statistic and a hypothesized population parameter Evidence has to be evaluated statistically before arriving at a conclusion regarding the hypothesis. Depends on whether information generated from the sample is with fewer or larger observations 3 Marketing Research 12th Edition 3 Hypothesis Testing The null hypothesis (Ho) is tested against the alternative hypothesis (Ha). At least the null hypothesis is stated. Decide upon the criteria to be used in making the decision whether to “reject” or "not reject" the null hypothesis. 4 Marketing Research . | Marketing Research Aaker, Kumar, Leone and Day Twelfth Edition Instructor’s Presentation Slides 1 Chapter Seventeen 2 Hypothesis Testing: Basic Concepts and Tests of Association Marketing Research 12th Edition Hypothesis Testing: Basic Concepts Assumption (hypothesis) made about a population parameter (not sample parameter) Purpose of Hypothesis Testing To make a judgment about the difference between two sample statistics or between sample statistic and a hypothesized population parameter Evidence has to be evaluated statistically before arriving at a conclusion regarding the hypothesis. Depends on whether information generated from the sample is with fewer or larger observations 3 Marketing Research 12th Edition 3 Hypothesis Testing The null hypothesis (Ho) is tested against the alternative hypothesis (Ha). At least the null hypothesis is stated. Decide upon the criteria to be used in making the decision whether to “reject” or "not reject" the null hypothesis. 4 Marketing Research 12th Edition 4 5 Hypothesis Testing Process Problem Definition Clearly state the null and alternative hypotheses Choose the relevant test and the appropriate probability distribution Choose the critical value Compare test statistic & critical value Reject null Determine the significance level Compute relevant test statistic Determine the degrees of freedom Decide if one-or two-tailed test Do not reject null Does the test statistic fall in the critical region? Marketing Research 12th Edition Yes No Basic Concepts of Hypothesis Testing Three Criteria Used To Decide Critical Value (Whether To Accept or Reject Null Hypothesis): Significance Level Degrees of Freedom One or Two Tailed Test 6 Marketing Research 12th Edition Significance Level Indicates the percentage of sample means that is outside the cut-off limits (critical value) The higher the significance level ( ) used for testing a hypothesis, the higher the probability of rejecting a null hypothesis when it is true (Type I error) .

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