7 Hypothesis Testing

Question 1

What is the null hypothesis?

Answer 1

H0, the hypothesis you assume to be correct

Question 2

What is the alternative hypothesis

Answer 2

H1, tells you about the parameter if your assumption is shown to be wrong

Question 3

What is the significance level

Answer 3

The level of accuracy needed to disprove the null hypothesis, the lower the % the more confident we can be if it is disproved

Question 4

What is a critical region?

Answer 4

A region of the probability distribution which, if the test statistic falls within it, would cause you to reject the null hypothesis

Question 5

What is the critical value?

Answer 5

The first value to fall inside the critical region

Question 6

What is a two tailed test?

Answer 6

A test with two critical regions, one at each end

Question 7

What just you do to the significance level in a two tailed test?

Answer 7

Halve it, if it is 5% then 2.5% on each end